2023 ANNUAL REPORT
Registration number: CVR no. 29801843
01.01.2023-31.12.2023
2023
ANNUAL
REPORT
2023 ANNUAL REPORT
PAGE 1
WE ARE
FARMERS AND
AGRIBUSINESS
MANAGERS
CONTENTS
Business Highlights 2
Financial Review 3
The Share 6
Corporate Social Responsibility 7
Financial History 14
Consolidated Financial Statements 15
Consolidated Balance Sheet 15
Consolidated Income Statement 16
Consolidated Statement of Comprehensive Income 17
Consolidated Statement of Changes in Equity 18
Consolidated Statement of Cash Flow 19
Contents of Notes to the Consolidated Financial Statements 20
Notes to the Consolidated Financial Statements 21
Financial Statements of the Parent Company 65
Management´s Statement 78
Independent Auditor´s Report 79
Definitions 82
2023 ANNUAL REPORT
PAGE 2
BUSINESS HIGHLIGHTS
• In 2023 Agromino returned to pre-war
production level in crop yields t/ha and
increased its crop output from 102 th t. to
140 th t. Agromino stays resilient also in
the second year of russian war against
Ukraine.
• Years 2023 and 2022 were characterized
by building strong logistics of Agromino.
After setting up railway transportation
routes in 2022 Agromino created fleet of
own and hired vessels to use both sea and
river ports in 2023. Export locations were
expanded accordingly.
• Agromino built new storage capacities
during 2023 in the volume of 16 th. tonnes
to replace its blocked silo capacity in
Vovchansk region.
• Agromino continued sharing its storage and
logistic capacities to other farmers. Trading
of third parties’ grain started in 2022 and
turned out to become new business line in
its operations.
• In December 2023 the group started to
build its own port operator and thus
growing into vertically integrated
agricultural commodities producer and
merchant, logistics company, port operator
and shipowner. These capabilities secure a
seamless, traceable and responsible supply
chain from farmers to consumers.
• EBITDA profit of USD 3.8 million in 12m
2023 compared to EBITDA loss of USD 0.2
million in 12m 2022.
• Net loss of USD 9.0 million in 12m 2023
compared to net loss of USD 12.9 million in
12m 2022.
• As at December 31, 2023, Agromino had
cash in amount USD 0.3 million and grain
and oilseeds for sale in amount USD 19.5
million, that are further being transferred
into cash. Additionally, all credit limits
existing in 2022 remained to be available
for the Group in 2023.
• Agromino continues to be among the main
foreign owned supporters of Ukraine in
humanitarian, business and defense
aspects.
• Because of slow demining and government
regulations 6 th. ha out of 42 th. ha
Agromino fields stayed unharvested in
2023.
20,1
23,3
- 0,2
3,81,2
10,9
- 12,9
- 9,0
MUSD
EBITDA
NET
PROFIT/LOSS
2020
2021
2022
2023
2023 ANNUAL REPORT
PAGE 3
FINANCIAL REVIEW
The Group’s operations include Ukraine
cereals (including storage and trading) and
milk production.
Total revenue, other income and
gain/loss of biological assets
Total revenue, other income and gain/loss of
biological assets of the Group for 2023 at USD
55.4 million compared to USD 40.1 million for
2022.
Changes in biological assets/inventories
The current biological assets as of the year end
consist of winter crops sown for 2024 harvest
and corn unharvested on 433 ha. Area under
winter crops was 10 511 ha as of December
31, 2023 (9 314 ha as of December 31, 2022).
Expenses
OPEX 2023 in comparison to OPEX 2022 is
specified in diagram below.
Net result
Agromino reached EBITDA profit from
operational activity of USD 3.8 million and net
loss of USD 9.0 million for 2023.
Assets
The consolidated assets of the Group as of
December 31, 2023, amounted to USD 106.8
million (USD 103.8 million at December 31,
2022).
Fixed assets
Property, plant and equipment as of December
31, 2023, in the amount of USD 20.8 million
accounted for 19% of the total assets,
comprising of land, buildings, machinery,
equipment and construction in progress.
Right-of-use assets include land right-of-use
asset recognized under IFRS 16 and Land
usage rights from business acquisition of
Resilient in the end of the year 2019. Right-of
use assets equaled USD 19.5 million or 18 % in
total assets as of December 31, 2023.
Total land under control as at December 31,
2023 was around 42 thousand hectares. The
land is covered with mostly medium to long-
term land lease contracts. There is 1.8
thousand hectares in ownership.
Inventories and biological assets
As of December 31, 2023, the inventories stood
at USD 26.1 million (USD 31.3 million as of
December 31, 2022).
Biological assets of USD 6.3 million as of
December 31, 2023, comprised of the dairy
herd, grasslands, winter crops seeded for 2024
harvest and corn unharvested in the field. Fair
value of biological assets sown for next year
harvest is determined by present valuing the
net cash flows expected to be generated from
the assets discounted at average cost of short-
term financing.
0 2 4 6 8 10 12 14 16 18 20
Seeds, fertilizers, chemicals
Employee benefits expense
Land tax and land rental
Animal feed
Repairs
Fuel, gas, electricity
Transportation, other services and materials
Office and administration expenses
Legal and consulting fees
Other expenses
OPEX (MUSD)
2023 2022
2023 ANNUAL REPORT
PAGE 4
Liabilities and equity
Borrowings
The total borrowings of the Group as of
December 31, 2023, amounted to USD 21.0
million (USD 14.9 million as at December 31,
2022).
Equity
The total number of shares with par value of 0.10
EUR in the Company equaled to 74,685,369 as
of December 31, 2023 (74,685,369 as of
December 31, 2022).
Lease liabilities
Lease liabilities include current and non-current
lease liabilities recognized under IFRS 16
adoption by the Group.
Property,
plant and
equipment
Prepayment
s,
receivables
and other
assets
Right-of-
use asset
Inventories
Biological assets
Equity
Borrowings
Lease
liability
Other
liabilities
Cash
0%
20%
40%
60%
80%
100%
Assets Equity and liabilities
BALANCE SHEET STRUCTURE 31.12.2023
Property,
plant and
equipment
Prepayments
, receivables
and other
assets
Right-of-use
asset
Inventories
Biological assets
Equity
Borrowings
Lease
liability
Other
liabilities
Cash
0%
20%
40%
60%
80%
100%
Assets Equity and liabilities
BALANCE SHEET STRUCTURE 31.12.2022
2023 ANNUAL REPORT
PAGE 5
GRAIN AND OILSEED PRODUCTION
The Group has its cereals production
operations in the black earth regions in
Kharkov, Kirovograd, Bila Tserkva, Zhytomyr,
and Khmelnytsky.
The revenue is made up primarily from sales
of own produced cereals.
The fair value of biological assets as at
December 31, 2023 has been determined by
valuing the discounted net cash flows
expected to be generated from the assets.
Harvested hectares
2019*
2020
2021**
2022***
2023
Wheat
16 124
18 875
8 009
9 706
6 168
Sunflower
12 910
14 084
14 202
7 369
12 111
Rapeseed
2 137
2 808
1 567
1 971
2 766
Corn
4 727
11 504
10 315
3 257
5 848
Barley
-
261
61
-
-
Soya
6 001
1 016
3 505
2 741
4 000
Other
3 479
2 421
4 266
4 256
4 386
Total
45 378
50 969
41 925
29 300
35 279
Net production, t
2019*
2020
2021**
2022***
2023
Wheat
61 650
90 998
40 440
42 611
33 901
Sunflower
34 934
34 410
43 796
20 914
29 680
Rapeseed
3 429
6 695
3 865
5 933
8 386
Corn
38 659
64 392
80 161
21 784
55 728
Barley
-
1 255
221
-
-
Soya
11 048
2 182
8 624
4 880
9 491
Other
10 810
8 910
14 134
6 129
3 149
Total
160 530
208 842
191 241
102 251
140 335
Net yield, t/ha
2019*
2020
2021**
2022***
2023
Wheat
3.82
4.82
5.05
4.39
5.50
Sunflower
2.71
2.44
3.08
2.84
2.45
Rapeseed
1.60
2.38
2.47
3.01
3.03
Corn
8.18
5.60
7.77
6.69
9.53
Barley
-
4.80
3.62
-
-
Soya
1.84
2.15
2.46
1.78
2.37
Other
3.11
3.68
3.31
1.44
0.72
Total
3.54
4.10
4.56
3.49
3.98
* Resilient harvesting was included since October 17, 2019.
** Nikolaev and Gorodylovychi harvesting was excluded since April 2021
*** Decrease by unharvested hectares due to occupation (only part of them could be harvested)
Additional information: Hectares in crops production only (milk production excluded).
1,60
2,38
2,47
3,01
3,03
3,82
4,82
5,05
4,39
5,50
2,71
2,44
3,08
2,84
2,45
8,18
5,60
7,77
6,69
9,53
1,84
2,15
2,46
1,78
2,37
0,00
2,00
4,00
6,00
8,00
10,00
12,00
2019 2020 2021 2022 2023
CROP NET YIELDS, t/ha
Rapeseed Wheat Sunflower Corn Soya
2023 ANNUAL REPORT
PAGE 6
Tonnes sold for the
period, t
2019
2020
2021
2022
2023
Wheat
65 899
88 591
38 161
14 447
58 462
Sunflower
42 583
55 801
40 158
4 091
24 265
Rapeseed
3 556
6 758
3 905
1 403
12 748
Corn
21 004
83 377
25 653
63 826
41 163
Barley
51
1 140
56
3
-
Soya
17 769
1 705
3 013
5 610
12 262
Other
7 503
4 847
13 567
8 608
5 456
Total
158 365
242 219
124 513
97 988
154 356
Ending stocks, t
2019
2020
2021
2022
2023
Wheat
1 371
289
694
34 744
21 232
Sunflower
22 460
511
4 413
20 963
26 610
Rapeseed
17
37
27
3 902
-
Corn
25 648
706
54 575
27 088
40 576
Barley
173
54
7
5
-
Soya
41
10
5 193
4 868
816
Other
4 773
9 308
9 171
5 870
3 169
Total
54 483
10 915
74 080
97 440
92 403
Average value of stocks,
USD/ton
2019
2020
2021
2022
2023
Wheat
160
234
276
177
152
Sunflower
319
627
643
334
332
Rapeseed
396
365
659
507
-
Corn
139
181
222
199
140
Barley
149
227
286
-
-
Soya
329
368
589
417
408
Other
193
197
248
306
450
Total
218
218
277
250
211
Ending value of stocks,
USD thousand
2019
2020
2021
2022
2023
Wheat
219
67
192
6 158
3 229
Sunflower
7 162
320
2 836
7 013
8 823
Rapeseed
7
13
18
1 976
-
Corn
3 554
128
12 136
5 395
5 660
Barley
26
12
2
-
-
Soya
13
4
3 061
2 032
333
Other
920
1 838
2 278
1 797
1 426
Total
11 901
2 382
20 523
24 371
19 471
THE SHARE
Share information
Major shareholders as at 31.12.2023
Country
No of shares
(thousands)
No of votes
(thousands)
MABON investiční fond s p.z.k.
Czech Republic
74 685
74 685
Total number
74 685
74 685
As at July 4, 2024 Mabon investiční fond s p.z.k. owns 74 685 thousands shares and holds the same
number of votes.
2023 ANNUAL REPORT
PAGE 7
CORPORATE SOCIAL RESPONSIBILITY
2023 ANNUAL REPORT
PAGE 8
• Regulatory Compliance: We ensure
• Market Volatility: The agricultural sector is
• Operational Risks: These include risks
• Social Risks: We are aware of the potential
• War Related Risks: All material assets of the
• Governance Risks: Strong governance
2023 ANNUAL REPORT
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2023 ANNUAL REPORT
PAGE 14
FINANCIAL HISTORY
Income statement, USD thousand
2019
2020
2021
2022
2023
Revenue from continuing operations
39 880
58 894
47 850
35 616
53 882
Total revenue, other income and fair
value adjustments from continuing
operations
43 403
57 368
44 784
40 076
55 428
EBIT from continuing operations
6 630
13 091
16 090
-6 271
-2 794
Net financials from continuing
operations
-3 560
-10 636
-4 849
-6 503
-5 986
Net profit/loss
2 980
1 163
10 870
-12 857
-9 025
EBITDA
11 177
20 132
23 338
-152
3 775
Currency translation difference
recycled from Other Comprehensive
Income to Income Statement in
relation to disposal of subsidiaries
-
-
-7 789
-10 484
-
EBITDA, excluding currency translation
difference recycled effect
11 177
20 132
31 127
10 332
3 775
Balance sheet, USD thousand
31.12.2019
31.12.2020
31.12.2021
31.12.2022
31.12.2023
Total assets
126 845
99 946
111 186
103 829
106 831
incl Non-current assets
87 356
73 544
69 262
52 219
61 133
incl Property, plant and equipment
29 565
26 345
24 545
19 008
20 796
Investment in property, plant and
equipment
5 602
7 247
4 407
5 302
5 972
Net debt (including accrued interest)
-16 779
3 788
786
-14 185
-20 735
Total equity
59 135
53 422
87 175
66 918
56 461
Cash flow statement, USD
thousand
2019
2020
2021
2022
2023
Cash flows from operating activities
12 440
31 042
9 429
-8 782
9 072
Cash flows from investing activities
-7 041
-369
-6 961
627
-5 939
Cash flows from financing activities
-6 429
-25 060
-8 374
6 444
-3 641
Effects of exchange rate changes
2 372
98
70
950
91
Cash and cash equivalents at
beginning of period
803
2 134
7 393
1 456
695
Cash and cash equivalents at end of
period
2 134
7 393
1 456
695
278
Key figures
31.12.2019
31.12.2020
31.12.2021
31.12.2022
31.12.2023
Number of shares, end of the period
(adjusted for reversed share split)
24 895 123
24 895 123
74 685 369
74 685 369
74 685 369
Total number of employees
1 028
923
738
Land under control, thousand hectares
55,3
54,5
44,8
42,3
42,3
Ratios
2019
2020
2021
2022
2023
Book value per share, USD (adjusted
for reversed share split)
2,36
2,13
1,17
0,90
0,76
Return on assets (ROA)
3%
1%
10%
-12%
-9%
Return on equity (ROE)
6%
2%
16%
-17%
-15%
Equity ratio, %
47%
54%
79%
64%
53%
Current ratio
1,32
1,24
4,60
2,37
1,39
Acid test
0,36
0,54
1,03
0,7
0,42
For definitions of the ratios please refer to page 82.
2023 ANNUAL REPORT
PAGE 15
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEET
in USD thousand
Note
31.12.2023
31.12.2022
1
ASSETS
Current assets
Cash and cash equivalents
5,7
Trade and other receivables
6,7
Inventories
8
Biological assets
9
Assets held for sale
Current assets
Prepaid land rents and land usage
rights
12
Other non-current prepayments and
receivables
6,7
Biological assets
9
Intangible assets
10
Property, plant and equipment
11
Right-of-use asset
22
Non-current assets
Total assets
LIABILITIES
Trade and other payables
7,13
Borrowings
7,14
Current portion of lease liability
22
Deferred income from subsidies
11
Current liabilities
Trade and other payables
7,13
Borrowings
7,14
Lease liability
22
Deferred tax liabilities
16
Deferred income from subsidies
11
Non-current liabilities
Total liabilities
EQUITY
Ordinary shares
17
Share premium
17
Other reserves
18
-60 714
-59 283
Accumulated profit/(deficit)
Capital and reserves attributable to
equity holders of the Group
Non-controlling interest in equity
-30
-29
Total equity
Total equity and liabilities
The notes on pages 21 to 64 are an integral part of these consolidated financial statements.
1
Recalculated due to correction of assumption as of 31.12.2022. See details in Note 2.1
2023 ANNUAL REPORT
PAGE 16
CONSOLIDATED INCOME STATEMENT
in USD thousand
Note
2023
2022
1
Continuing operations:
Revenue
19
Total revenue
Other income
19
Gain/loss of biological assets arising from changes in fair value less cost to
sell
9
Other income and fair value adjustments
Net changes in inventories of agricultural produce and work in
process
8
-3 035
Cost of purchased goods for trading purposes
-2 674
-1 650
Raw materials and consumables used for production purposes
20
-38 219
-29 799
Employee benefits expense
21
-5 691
-5 698
Depreciation and amortization
-6 569
-5 948
Other administrative expenses
23
-1 693
-1 561
Other (losses)/gains - net
24
-341
-9 222
-2 794
-6 271
Gains/losses from exchange rate differences
-506
-2 883
Finance income
25
Finance costs
25
-5 923
-3 775
Profit/loss before income tax
-8 780
-12 774
Corporate income tax (expense)/profit
15
-245
-144
Profit/loss for the period from continuing operations
-9 025
-12 918
Discontinued operations
Profit/Loss for the period from discontinued operations
31
Profit/Loss for the period
-9 025
-12 857
Attributable to:
Equity holders of the Company
-9 025
-12 857
Non-controlling interest
-9 025
-12 857
The notes on pages 21 to 64 are an integral part of these consolidated financial statements.
1
Recalculated due to correction of assumption as of 31.12.2022. See details in Note 2.1
2023 ANNUAL REPORT
PAGE 17
CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
in USD thousand
2023
2022
1
Profit/Loss for the period
-9 025
-12 857
Other comprehensive income:
Items that will not be reclassified to profit or loss
Gain/Loss from revaluation of land of continuing operations
11,18
Items that may be subsequently reclassified to profit or loss
Currency translation differences (Note 3.1.1.(i))
18
-1 431
-17 886
Currency translation difference recycled from Other Comprehensive Income to
Income Statement in relation to disposal of subsidiary
Other comprehensive expense/income for the period; net of tax
-1 431
-7 402
Total comprehensive income/expense for the period
-10 456
-20 259
Attributable to:
Equity holders of the Company
-10 456
-20 259
Non-controlling interest
Total comprehensive income/expense for the period
-10 456
-20 259
The notes on pages 21 to 64 are an integral part of these consolidated financial statements.
1
Recalculated due to correction of assumption as of 31.12.2022. See details in Note 2.1
2023 ANNUAL REPORT
PAGE 18
CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY
Attributable to equity holders of the Company
in USD thousand
Share
capital
Share
premium
Other
reserves
Accumulated
profit/(deficit)
Total
Non-
controlling
interest
Total
Equity
Balance at 31.12.2021
-51 881
-31
Profit/loss for the period
1
-12 857
-12 857
-12 855
Other Comprehensive Income
recycled to Income Statement in
relation to disposal of subsidiary
Other comprehensive income
1
-17 886
-17 886
-17 886
Total comprehensive income
-7 402
-12 857
-20 259
-20 257
Balance at 31.12.2022
1
-59 283
-29
Profit/loss for the period
-9 025
-9 025
-1
-9 026
Other Comprehensive Income
recycled to Income Statement in
relation to disposal of subsidiary
Other comprehensive income
-1 431
-1 431
-1 431
Total comprehensive income
-1 431
-9 025
-10 456
-1
-10 457
Balance at 31.12.2023
-60 714
-30
The notes on pages 21 to 64 are an integral part of these consolidated financial statements.
1
Recalculated due to correction of assumption as of 31.12.2022. See details in Note 2.1
2023 ANNUAL REPORT
PAGE 19
CONSOLIDATED STATEMENT OF CASH FLOW
in USD thousands
Note
2023
2022
Cash flows from operating activities
Cash receipts from customers
Cash paid to suppliers and employees
-46 586
-45 503
Income tax paid
15
-153
-94
Subsidies received
Interest received
25
Net cash used in/generated from operating activities
-8 782
Cash flows from investing activities
Disposal of subsidiary, net of cash disposed of
Purchase of property, plant and equipment
11
-5 969
-1 490
Proceeds from sales of property, plant and equipment
11
Net cash generated from investing activities
-5 939
Cash flows from financing activities
Proceeds from new shares issued
Proceeds from borrowings
14
Repayments of borrowings
14
-14 675
-9 623
Repayments of lease liabilities
14
-730
-922
Repayments of land lease liabilities
-4 130
-2 388
Interest paid
25
-1 930
-549
Proceeds and repayments of loans with related parties
-3 325
-2 352
Other movement
Net cash used in financing activities
-3 641
Net decrease/increase in cash and cash equivalents
-508
-1 711
Effects of exchange rate changes on cash and cash equivalents
Classified as held for sale
Cash and cash equivalents at beginning of period
5
Cash and cash equivalents at end of period
5
The notes on pages 21 to 64 are an integral part of these consolidated financial statements.
2023 ANNUAL REPORT
PAGE 20
CONTENTS OF NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS
1. General information ..................................................................................................... 21
2. Summary of significant accounting policies ..................................................................... 21
3. Financial risk management ........................................................................................... 31
4. Critical Accounting Estimates and Judgments .................................................................. 34
5. Cash and cash equivalents ............................................................................................ 37
6. Trade and other receivables .......................................................................................... 37
7. Financial instruments by category .................................................................................. 39
8. Inventories ................................................................................................................. 39
9. Biological assets .......................................................................................................... 41
10. Intangible assets ....................................................................................................... 43
11. Property, plant and equipment .................................................................................... 44
12. Prepaid land rents and land usage rights ...................................................................... 46
13. Trade and other payables ........................................................................................... 46
14. Borrowings ............................................................................................................... 47
15. Income tax ............................................................................................................... 50
16. Deferred tax.............................................................................................................. 51
17. Share capital ............................................................................................................. 52
18. Other reserves .......................................................................................................... 53
19. Revenue and other income .......................................................................................... 53
20. Raw materials and consumables used for production purposes ........................................ 54
21. Employee benefits expense ......................................................................................... 54
22. RIGHT-OF-USE ASSET AND LEASE LIABILITY ................................................................ 54
23. Other administrative expenses .................................................................................... 56
24. Other (losses)/gains-net ............................................................................................. 56
25. Finance income and finance cost .................................................................................. 56
26. Contingencies ............................................................................................................ 56
27. Commitments............................................................................................................ 58
28. Group structure ......................................................................................................... 59
29. Related party transactions .......................................................................................... 60
30. Fees to the auditors appointed by the shareholders ........................................................ 61
31. Disposal of Subsidiaries .............................................................................................. 61
32. Events after the balance sheet date ............................................................................. 64
2023 ANNUAL REPORT
PAGE 21
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
1. GENERAL INFORMATION
Agromino A/S (The Company) is an integrated
soft commodities producer (operating
commercial cereals and dairy farms), storage
provider and trader with operations in Ukraine
(no farms etc. are in the Czech Republic).
The parent company is a limited liability
company incorporated and domiciled in
Denmark. The address of its registered office is
c/o Advokatfirmaet Poul Schmith, Kalvebod
Brygge 32, DK-1560, Copenhagen, Denmark.
Since August 13, 2021 Mabon has been
registered in the shareholders’ register as the
sole owner of all shares in Agromino A/S.
These financial statements were authorised for
issue by the Board of Directors on July 4, 2024.
2. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
The principal accounting policies applied in the
preparation of these financial statements are
set out below. The policies have been
consistently applied to all the years presented
unless otherwise stated.
2.1 BASIS OF PREPARATION
This consolidated financial information of
Agromino A/S for 2023 ended December 31,
2023, has been prepared in accordance with
International Financial Reporting Standards
(IFRS) as adopted by the European Union and
further requirements in the Danish Financial
Statements Act. The consolidated financial
statements have been prepared under the
historical cost convention, as modified by the
revaluation of biological assets and land.
The reporting period of the consolidated
financial statements is the calendar year.
The Company prepares its separate financial
statements in accordance with IFRS as adopted
by the European Union and the further
requirements in the Danish Financial
Statements Act. Parent company financial
statements are presented after notes to the
consolidated financial statements in the same
set of financial statements.
The preparation of financial statements in
conformity with IFRS requires the use of certain
critical accounting estimates. It also requires
management to exercise its judgment in the
process of applying the Group’s accounting
policies. The areas involving a higher degree of
judgment or complexity, or areas where
assumptions and estimates are significant to
the consolidated financial statements are
disclosed in Note 4.
ADOPTION OF NEW OR REVISED STANDARDS
AND INTERPRETATIONS
New and amended IFRS Standards that are
effective for the current year
In the current year, the Group has applied a
number of amendments to IFRS Standards and
Interpretations issued by the IASB that are
effective for an annual period that begins on or
after 1 January 2023.
- IFRS 17 – Insurance Contracts and
Amendments to IFRS 17
- Amendments to IAS 1 and IFRS Practice
Statement 2 – Disclosure of Accounting
Policies
- Amendments to IAS 8 – Definition of
Accounting Estimates
- Amendments to IAS 12 – Deferred Tax
related to Assets and Liabilities arising
from a Single Transaction
- Amendments to IAS 12 – International Tax
Reform – Pillar Two Model Rules
The Group has not early adopted any other
standard, interpretation or amendment that
has been issued but is not yet effective:
- Amendments to IFRS 10 and IAS 28 - Sale
or Contribution of Assets between an
Investor and its Associate or Joint Venture
- Amendments to IAS 1 – Classification of
Liabilities as Current or Non-current
- Amendments to IAS 1 – Non-current
Liabilities with Covenants
2023 ANNUAL REPORT
PAGE 22
- Amendments to IAS 7 and IFRS 7 -
Supplier Finance Arrangements
- Amendments to IFRS 16 – Lease Liability
in a Sale and Leaseback
- Amendments to IAS 21 - Lack of
Exchangeability
Their adoption has not had any material impact
on the disclosures or on the amounts reported
in these financial statements.
CORRECTION OF MATERIAL ERROR IN
COMPARATIVE DATA
Since 2022 Agromino Group increased export
portion in sales significantly (from 42 % in
2021 to 79 % in 2022). At the moment of
agricultural produce revaluation performing as
at December 31, 2022, Group planned to
export sunflower mainly together with other
agricultural produce. In this regards, sunflower
was revaluated at netto price (404USD/t or
14 753 UAH/t), at which the Group expected to
sell sunflower, based on contracts concluded
for part of sunflower (in March-April 2023).
However, Management assumption regarding
sunflower price were not fulfilled. Sunflower
was not exported, but sold mainly at domestic
market at weighted-avarage price (319 USD/t
or 11 686 UAH/t). Weighted-avarage price
between prices at export and internal market
was 334 USD/t or 12 206 UAH/t. Contracts
were mainly concluded in June 2023, but were
mistakenly not taken into consideration while
subsequent events analyzing. Since effect is
significant, recalculation of sunflower value as
at 31.12.2022 is performed and effect of such
recalculation on comparative period is
presented below:
Effect on Consolidated
Balance Sheet
in USD thousand
31.12.2022
Sunflower value at Inventory
balance
-1 462
Total effect on assets
-1 462
Accumulated profit/(deficit)
-1 653
Other reserves
191
Total effect on Equity
-1 462
Effect on Consolidated
Income Statement
2022
Net changes in inventories of
agricultural produce and work
in process
-1 653
Total effect on Income
Statement
-1 653
CONSOLIDATION
a) Subsidiaries
Subsidiaries are all entities over which the
group has control. The group controls an entity
when the group is exposed to, or has rights to,
variable returns from its involvement with the
entity and has the ability to affect those returns
through its power over the entity. Subsidiaries
are fully consolidated from the date on which
control is transferred to the group. They are
deconsolidated from the date that control
ceases.
The Group uses the acquisition method of
accounting to account for business
combinations. The consideration transferred for
the acquisition of a subsidiary is the fair values
of the assets transferred, the liabilities incurred
and the equity interests issued by the Group.
Any difference between fair value and the
carrying value of assets transferred is
recognised in the income statement. The
consideration transferred includes the fair
value of any asset or liability resulting from a
contingent consideration arrangement.
Acquisition-related costs are expensed as
incurred. Identifiable assets acquired and
liabilities and contingent liabilities assumed in
a business combination are measured initially
at their fair values at the acquisition date. On
an acquisition-by-acquisition basis, the Group
recognises any non-controlling interest in the
acquiree either at fair value or at the non-
controlling interest’s proportionate share of the
acquiree’s net assets. The excess of the
consideration transferred, the amount of any
non-controlling interest in the acquiree and the
acquisition-date fair value of any previous
equity interest in the acquiree over the fair
value of the Group’s share of the identifiable
net assets acquired is recorded as goodwill. If
this is less than the fair value of the net assets
of the subsidiary acquired in the case of a
bargain purchase, the difference is recognised
directly in the income statement.
Inter-company transactions, balances and
unrealised profits on transactions between
Group companies are eliminated. Losses are
also eliminated but considered whether they
indicate an impairment that requires
recognition in consolidated financial
statements. Accounting policies of subsidiaries
have been changed where necessary to ensure
consistency with the policies adopted by the
Group.
2023 ANNUAL REPORT
PAGE 23
Going concern statement
On 24 February 2022 russian federation
launched a full-scale military invasion of
Ukraine. This was followed up by the
immediate enactment of martial law by the
government of Ukraine and corresponding
introduction of the related temporary
restrictions that impact the economic
environment. Considering the above,
Agromino has assessed the going concern
assumption based on which the financial
statements have been prepared.
There is a significant uncertainty over
the future development of military invasion,
its duration and short and long-term impact
on the Group, its people, operations, liquidity,
and assets. There could be multiple scenarios
of further developments of the current
situation with unknown likelihood and the
magnitude of the impact on the Group might
be from significant to severe.
However, the Group’s key personnel
and top managers continue working. None of
the Group's critical facilities or infrastructure
has suffered any significant damage. The
business processes have been reorganized to
adjust to the existing challenges and to
provide continuity to the Group’s activities.
Part of land in Kharkiv region was
located at temporarily occupied territory
(period from February till September 2022).
However, after de-occupation that land began
to be cultivated for future sowing at once.
As a result of military actions, Black Sea
ports in Ukraine suspended their operations,
making export through the sea terminals
temporarily inaccessible. Management had to
rearrange its delivery routes, setting up new
logistic procedures and in search for new
counterparties. In the end of July 2022 ports
“Odessa”, “Chornomorsk” and “Pivdennyi”
were unblocked by concluding Black Sea Grain
Initiative by russia and Ukraine with the
support of the UN and Turkey in Istanbul. It
was prolonged several times after that. On
May 17, 2023 president of Turkey Recep
Tayyip Erdogan declared the prolongation of
Grain deal for further two months. On July
2023 term of Black Sea Grain Initiative
terminated, russia refused to take part in it.
However, the Group has well-arranged logistic
for grain export via overland routes to
European countries, and it allowed the Group
to sell agricultural produce even in case of
problems with Grain deal. Since September
2023 Agromino set up a fleet of cooperating
vessels (both owned by Agromino´s affiliates
as well as by third parties) to use both sea and
river ports. Export locations were expanded
accordingly.
Since 2022 the Group devoted part of
its logistic capacities to other farmers and
implemented new direction of its operations –
trading of third parties’ grain. Decision to start
this activity was made not only from economic
point of view but also to help eastern Ukraine
farmers who suffered the most from
consequences of war.
In order to support the ability to
operate on going concern basis, Group
Management prepared Budget and Cash Flow
Forecast for the year 2024, demonstrating the
ability of the Group to operate on going
concern basis. Budget 2024 was prepared
based on assumption that the degree of
intensity of military hostilities in the regions
where the Group’s assets are located and the
area of the Ukrainian territory currently
invaded by the russian troops will not
increase; the Group is able to carry out sowing
and harvesting of crops; the railway
infrastructure performs its function and is
used as a way of executing export sales, the
Group is also able to use sea and river ports
to continue execute export sales by sea.
Management has maintained a fruitful
relation with the banks in 2023.
In 2023 the Group extended its storage
capacities which are of great importance for
agroproducers.
The Group continues to generate its
revenue mainly from sales of grain in 2024.
Settlements with buyers and suppliers are
conducted by the Group under normal course
of business operations.
Military actions will continue to create
material uncertainty for the Group in the
future. There is the risk of assets damage, loss
of inventory either physical loss as a result of
military actions, or appropriation for military
needs under the Martial Law in Ukraine, ability
of Black Sea ports to resume its operations,
availability of alternative export routes and
disruptions of the sowing and harvesting
campaign for the Group and for Ukraine in
general. The full extent of the impact of
further development of military actions on the
Group’s business is unknown, but its
magnitude might be severe. Management
acknowledges that future development of
military actions and their duration represent a
single source of material uncertainty which
may cast significant doubt about the Group’s
ability to continue as a going concern and,
therefore, the Group may not be able to
realize its assets and discharge its liabilities in
the normal course of business. Despite the
single material uncertainty relating to the war
in Ukraine, management continues to take
actions to minimize the impact on the Group
and thus believes that application of the going
concern assumption for the preparation of
these financial statements is appropriate.
An effect of war on significant
assumptions used in Group’s forecasts cannot
be predicted, thus Management came to
conclusion that there is a material
2023 ANNUAL REPORT
PAGE 24
uncertainty, that can cause significant
changes in operating activity of the Group in
case of expanding zone of military actions.
2.2 FOREIGN CURRENCY
TRANSLATION
a) Functional currency
Items included in the financial statements of
each of the Group’s entities are measured
using the currency of the primary economic
environment in which the entity operates (‘the
functional currency’). The functional
currencies of group entities are the following:
for Estonian subsidiaries the Euro, for
Ukrainian subsidiaries the Ukrainian hryvna,
for Cypriot subsidiaries the Euro, for Czech
subsidiary the Czech koruna and for Danish
parent company the Euro.
b) Transactions and balances
Foreign currency transactions are translated
into the functional currency using the
exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and
losses resulting from the settlement of such
transactions and from the translation at year-
end exchange rates of monetary assets and
liabilities denominated in foreign currencies
are recognised in the income statement.
Foreign exchange gains and losses that relate
to borrowings and cash equivalents are
presented in the income statement within
‘Gains/losses from exchange rate differences’.
All other foreign exchange gains and losses
are presented in the income statement within
‘Other (losses)/gains – net.
c) Presentation currency
The results and financial position of all the
Group entities (none of which has the currency
of a hyperinflationary economy) that have a
functional currency different from the
presentation currency are translated into the
presentation currency as follows:
(a) assets and liabilities for each balance
sheet presented are translated at the
closing rate at the date of that balance
sheet;
(b) income and expenses for each income
statement are translated at average
exchange rates of a month or a longer
period as appropriate (unless this
average is not a reasonable
approximation of the cumulative effect
of the rates prevailing on the
transaction dates, in which case
income and expenses are translated at
the rate on the dates of the
transactions); and
(c) all resulting exchange differences are
recognised in other comprehensive
income.
On consolidation, exchange differences arising
from the translation of the net investment in
foreign operations and of borrowings are taken
to shareholders’ equity. When a foreign
operation is partially disposed of or sold,
exchange differences that were recorded in
Other comprehensive income are recognised in
the income statement as part of the gain or loss
on the sale.
Goodwill and fair value adjustments arising on
the acquisition of a foreign entity are treated as
assets and liabilities of the foreign entity and
translated at the closing rate.
In the year 2021 Agromino decided to change
its presentation currency from EUR to USD due
to Group perspective:
- Main revenue of the Group is generated
from grain sales and grain prices were mainly
denominated in USD or were related to USD
fluctuation. Bank loans of the Group were also
mostly denominated in USD historically.
The consolidated financial statements are
presented in USD, which became to be the
presentation currency for the group, and thus
comparative information was translated in USD
also.
Comparative amounts were translated from
EUR to USD in order to put them into
correspondence:
- Assets and liabilities were translated
using exchange rate USD/EUR (per
European Central Bank) as of each
reporting date.
- Income and expenses were translated
using average exchange rate USD/EUR
(per European Central Bank) for each
corresponding year presented.
- Accumulated earnings (deficit)
translated based on financial result for
each corresponding historical reporting
year using average exchange rate
USD/EUR (per European Central Bank)
for each corresponding year.
Translation was made since the first
reporting date 31/12/2006 at which
consolidated report of the Group was
prepared.
2023 ANNUAL REPORT
PAGE 25
2.3 PROPERTY, PLANT AND EQUIPMENT
All property, plant and equipment except for
land is stated at historical cost less depreciation
and impairment, where required. Historical cost
includes expenditure that is directly
attributable to the acquisition of the items.
Subsequent costs are included in the asset’s
carrying amount or recognised as a separate
asset, as appropriate, only when it is probable
that future economic benefits associated with
the item will flow to the Group and the cost of
the item can be measured reliably. The carrying
amount of the replaced part is derecognised. All
other repairs and maintenance are charged to
the income statement during the financial
period in which they are incurred.
The land is not depreciated. Depreciation on
other assets is calculated using the straight-line
method to allocate their cost to their residual
values over their estimated useful lives, as
follows:
• Buildings 25-40 years
• Machinery 7-20 years
• Vehicles 3-5 years
• Furniture, fittings and equipment 3-8 years
The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at each
balance sheet date.
An asset’s carrying amount is written down
immediately to its recoverable amount if the
asset’s carrying amount is greater than its
estimated recoverable amount (Note 2.5).
Gains and losses on disposals are determined by
comparing the proceeds with the carrying
amount and are recognised within Other
gains/losses – net, in the income statement.
General and specific borrowing costs directly
attributable to the acquisition, construction or
production of qualifying assets, which are assets
that necessarily take a substantial period of time
to get ready for their intended use or sale, are
added to the cost of those assets, until such time
as the assets are substantially ready for their
intended use or sale.
FAIR VALUE OF LAND
Land is carried using the revaluation method.
Under the revaluation method, an increase in
an asset’s carrying amount as a result of a
revaluation is recognised in other
comprehensive income and accumulated in
equity under other reserves. However, the
increase is recognised in profit or loss to the
extent that it reverses a revaluation decrease
of the same asset previously recognised in
profit or loss. A decrease in an asset’s carrying
amount as a result of a revaluation is
recognised in profit or loss. However, the
decrease is recognised in other comprehensive
income to the extent of any credit balance
existing in the revaluation surplus in respect of
that asset. The decrease recognized in other
comprehensive income reduces the amount
accumulated in equity under other reserves
(Note 18).
Valuations are performed with sufficient
regularity to ensure that the fair value of a
revalued asset does not differ materially from
its carrying amount.
When revalued assets are sold, the amounts
included in other reserves are transferred to
retained earnings.
2.4 INTANGIBLE ASSETS
a) Licenses
Acquired computer software licences are
capitalised on the basis of the costs incurred to
acquire and bring to use the specific software.
These costs are amortised over their estimated
useful lives of two to ten years.
b) Land-usage rights under emphyteusis
Land-usage rights under emphyteusis are
capitalised on the basis of the costs incurred.
Land-usage rights are amortised over their
estimated useful lives to forty-nine years.
2.5 . IMPAIRMENT ON NON-FINANCIAL
ASSETS
Assets that are subject to depreciation and land
are reviewed for impairment whenever events
or changes in circumstances indicate that the
carrying amount may not be recoverable. An
impairment loss is recognised for the amount
by which the asset’s carrying amount exceeds
its recoverable amount. The recoverable
amount is the higher of an asset’s fair value
less costs of disposal and value in use. For the
purposes of assessing impairment, assets are
grouped at the lowest levels for which there are
separately identifiable cash flows (cash-
generating units). Non-financial assets other
than goodwill that suffered impairment are
reviewed for possible reversal of the
impairment at each reporting date.
2023 ANNUAL REPORT
PAGE 26
2.6 FINANCIAL ASSETS
a) Classification
The Group classifies its financial assets in the
following categories: loans and receivables.
The classification depends on the purpose for
which the financial assets were acquired.
Management determines the classification of its
financial assets at initial recognition. Loans and
receivables are non-derivative financial assets
with fixed or determinable payments that are
not quoted in an active market. They are
included in current assets, except for maturities
greater than 12 months after the balance sheet
date. These are classified as non-current
assets. The Group's loans and receivables
comprise “Trade and other receivables” (see
Note 6) and Cash and cash equivalents (see
Note 5) in the balance sheet. See Note 2.10 for
measurement of trade receivables.
b) Recognition and measurement
Regular purchases and sales of financial assets
are recognised on the trade-date – the date on
which the Group commits to purchase or sell
the asset. Investments are initially recognised
at fair value plus transaction costs for all
financial assets not carried at fair value through
profit or loss. Financial assets are derecognised
when the rights to receive cash flows from the
investments have expired or have been
transferred and the Group has transferred
substantially all risks and rewards of
ownership. Loans and receivables are carried at
amortised cost using the effective interest
method.
The Group assesses at each balance sheet date
whether there is objective evidence that a
financial asset or a group of financial assets is
impaired. Impairment testing of trade
receivables is described in Note 2.10.
c) Impairment of financial assets carried at
amortised cost
The Group assesses at the end of each
reporting period whether there is objective
evidence that a financial asset or group of
financial assets is impaired. A financial asset or
a Group of financial assets is impaired and
impairment losses are incurred only if there is
objective evidence of impairment as a result of
one or more events that occurred after the
initial recognition of the asset (a ‘loss event’)
and that loss event (or events) has an impact
on the estimated future cash flows of the
financial asset or Group of financial assets that
can be reliably estimated. Evidence of
impairment may include indications that the
debtors or a group of debtors are experiencing
significant financial difficulty, default or
delinquency in interest or principal payments,
the probability that they will enter bankruptcy
or other financial reorganisation.
For loans and receivables category, the amount
of the loss is measured as the difference
between the asset’s carrying amount and the
present value of estimated future cash flows
(excluding future credit losses that have not
been incurred) discounted at the financial
asset’s original effective interest rate. The
carrying amount of the asset is reduced and the
amount of the loss is recognised in the
consolidated income statement. If in a
subsequent period, the amount of the
impairment loss decreases and the decrease
can be related objectively to an event occurring
after the impairment was recognised, the
reversal of the previously recognised
impairment loss is recognised in the
consolidated income statement.
2.7 AGRICULTURE AND BIOLOGICAL
ASSETS
Agricultural activity is defined by the
management as an activity of the biological
transformation of biological assets for sale into
agricultural produce or into additional biological
assets. Agricultural produce is defined as the
harvested product of the Group’s biological
assets and a biological asset is defined as a
living animal or plant. The Group has
determined the groups of its biological assets
to be livestock and growing crops.
Biological assets are measured on initial
recognition and at each balance sheet date at
its fair value less cost to sell. Agricultural
produce harvested from the Group’s biological
assets is measured at its fair value less cost to
sell and is subsequently recorded as inventories
and measured in accordance with the
accounting principles of inventory (Note 2.9).
If an active market exists for a biological asset
or agricultural produce, the quoted price in that
market is the appropriate basis for determining
the fair value of that asset. If an active market
does not exist the most proximate market
transaction price, provided that there has not
been a significant change in economic
circumstances between the date of that
transaction and the balance sheet date, is used
in determining fair value.
A gain or loss arising on initial recognition of a
biological asset at fair value less cost to sell and
2023 ANNUAL REPORT
PAGE 27
from a subsequent change in fair value less
cost to sell is included in profit or loss for the
period in which it arises as “Gain/loss of
biological assets arising from changes in fair
value less cost to sell”.
The biological assets are recorded as current
and non-current biological assets based on the
operational cycle of the respective biological
assets. In general, biological assets of growing
plants are recognised as current assets
because the operational cycle is less than 12
months. Dairy herd is recorded as a non-
current biological asset.
a) Livestock and dairy herd
Livestock is measured at their fair value less
estimated point-of-sale costs. The fair value
measurements are categorized under Level 2 in
the fair value hierarchy, as defined by IFRS 13.
b) Crops – cereals and grassland
Crops are measured at their fair value less cost
to sell. The fair value measurements are
categorized under Level 3 in the fair value
hierarchy, as defined by IFRS 13. Fair value of
biological assets sown for next year harvest by
present valuing the net cash flows expected to
be generated from the assets discounted at
average cost of short-term financing.
The Group’s grasslands qualify as bearer plants
under the definition in IAS 41 Agriculture and
are therefore accounted for under the rules for
plant and equipment. The grasslands are
carried at cost less depreciation. Grasslands
are depreciated for a period of 3 years.
2.8 GOVERNMENT GRANTS
a) Government grants related to agricultural
activity
An unconditional government grant related to
a biological asset measured at its fair value less
cost to sell is recognised as income when the
government grant becomes receivable
(government grants for the dairy herd, general
area-aid subsidies). If a government grant
related to a biological asset measured at its fair
value less cost to sell, is conditional, including
whereby a government grant requires a Group
company not to engage in specified agricultural
activity, the Group recognizes the government
grant as income when the conditions attaching
to the government grant are met (investment
subsidies, area-aid environmental subsidies)
and until then aid received is recognized as a
liability.
b) Government grants related to purchase of
property, plant and equipment
Grants from the government are recognised at
their fair value where there is a reasonable
assurance that the grant will be received and
the group will comply with all attached
conditions. Government grants relating to
property, plant and equipment are included in
non-current liabilities as deferred government
grants and are amortised to the income
statement on a straight-line basis over the
expected lives of the related assets.
2.9 INVENTORIES
a) Agricultural produce
i. Milk
Milk is initially measured at its fair value
less cost to sell at the time of milking and
subsequently recorded as inventories and
measured at the lower of cost and net
realisable value. The fair value of milk is
determined based on market prices in the local
area.
ii. Grain- own produced (harvested)
Grain and feeds produced by the Group
are initially measured at its fair value less cost
to sell at the time of harvest and recorded in
inventories until sold to third parties or used
internally for feeding animals or for seeds.
Grains and feed produced by the Group are
subsequently measured at net realisable value.
The net realisable value of feed is determined
based on market prices in the local area. The
net realisable value of grain is determined
based on quoted prices on the nearest market
or if multiple markets are available, in the
market where the Group’s company expects to
sell the produce.
b) Grain – purchased from third parties
Purchased grain from third parties is initially
recorded at the purchase price and
subsequently measured at a fair value less cost
to sell. The fair value of grain is determined
based on quoted prices on the nearest market
or if multiple markets are available, on the
most advantageous market.
c) Work-in-progress related to field
preparation
Cost of agricultural preparation on fields before
seeding is recorded as work-in-progress in
inventories. Work in progress comprises raw
materials, direct labor costs and other direct
costs (based on normal operating capacity).
After seeding the cost of field preparation is
reclassified as biological assets (Note 2.7 b)).
2023 ANNUAL REPORT
PAGE 28
d) Raw materials
Inventories are stated at the lower of cost and
net realisable value. Cost is determined using
weighted average cost method. Net realisable
value is the estimated selling price in the
ordinary course of business, less applicable
variable selling expenses.
2.10 TRADE RECEIVABLES
Trade receivables are amounts due from
customers for merchandise sold or services
performed in the ordinary course of business.
If the collection is expected in one year or less
(or in the normal operating cycle of the
business if longer), they are classified as
current assets. If not, they are presented as
non-current assets.
Trade receivables are recognised initially at fair
value and subsequently measured at amortised
cost using the effective interest method, less
provision for impairment.
2.11 CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash in
hand, deposits held at call with banks, other
short-term highly liquid investments with
original maturities of three months or less.
Deposits over three months are classified as
cash and cash equivalents if they are readily
convertible to a known amount of cash and are
subject to insignificant risk of changes in value.
2.12 SHARE CAPITAL
Ordinary shares are classified as equity.
Incremental costs directly attributable to the
issue of new shares or options are shown in
equity as a deduction, net of tax, from the
proceeds.
2.13 TRADE PAYABLES
Trade payables are obligations to pay for goods
or services that have been acquired in the
ordinary course of business from suppliers.
Accounts payable are classified as current
liabilities if payment is due within one year or
less. If not, they are presented as non-current
liabilities.
Trade payables are recognised initially at fair
value and subsequently measured at amortised
cost using the effective interest method.
2.14 BORROWINGS
Borrowings are recognised initially at fair value,
net of transaction costs incurred. Borrowings
are subsequently stated at amortised cost; any
difference between the proceeds (net of
transaction costs) and the redemption value is
recognised in the income statement over the
period of the borrowings using the effective
interest method.
Borrowings are classified as current liabilities
unless the Group has an unconditional right to
defer settlement of the liability for at least 12
months after the balance sheet date.
Borrowings are removed from the balance
sheet when the obligation specified in the
contract is discharged, canceled or expired. The
difference between the carrying amount of a
financial liability that has been extinguished or
transferred to another party and the
consideration paid, including any non-cash
assets transferred or liabilities assumed, is
recognised in the Income statement as finance
income or finance cost. Where the terms of a
financial liability are renegotiated and the
entity issues equity instruments to a creditor to
extinguish all or part of the liability (debt for
equity swap), a gain or loss is recognised in the
Income statement, which is measured as the
difference between the carrying amount of the
financial liability and the fair value of the equity
instruments issued.
2.15 CURRENT AND DEFERRED INCOME
TAX
The tax expense for the period comprises a
current and deferred tax. Tax is recognised in
the income statement, except to the extent
that it relates to items recognised in other
comprehensive income or directly in equity. In
this case, the tax is also recognised in other
comprehensive income or equity, respectively.
a) Corporate income tax
The current income tax charge is calculated on
the basis of the tax laws enacted or
substantively enacted at the balance sheet date
in the countries where the Company and its
subsidiaries operate and generate taxable
income. Management periodically evaluates
positions taken in tax returns with respect to
situations in which applicable tax regulations
are subject to interpretation and establishes
provisions where appropriate on the basis of
amounts expected to be paid to the tax
authorities.
The Income tax rate in Ukraine is 18%, in
Denmark 22%, in Czech Republic 19% and in
Cyprus 12.5%. Agricultural producers in
Ukraine are exempted from the ordinary
corporate income tax system if they meet the
2023 ANNUAL REPORT
PAGE 29
requirements to be recognised as agricultural
producers (Note 2.15 b)).
Deferred income tax is provided in full, using
the liability method, on temporary differences
arising between the tax bases of assets and
liabilities and their carrying amounts in the
consolidated financial statements. However,
the deferred income tax is not accounted for if
it arises from initial recognition of an asset or
liability in a transaction other than a business
combination that at the time of the transaction
affects neither accounting nor taxable profit nor
loss. Deferred income tax is determined using
tax rates (and laws) that have been enacted or
substantially enacted by the balance sheet date
and are expected to apply when the related
deferred income tax asset is realised or the
deferred income tax liability is settled.
Deferred income tax assets are recognised to
the extent that it is probable that future taxable
profit will be available against which the
temporary differences can be utilised.
Deferred income tax is provided on temporary
differences arising on investments in
subsidiaries and associates, except where the
timing of the reversal of the temporary
difference is controlled by the Group and it is
probable that the temporary difference will not
reverse in the foreseeable future.
Deferred income tax assets and liabilities are
offset when there is a legally enforceable right
to offset current tax assets against current tax
liabilities and when the deferred income taxes
assets and liabilities relate to income taxes
levied by the same taxation authority on either
the taxable entity or different taxable entities
where there are an intention and ability to
settle the balances on a net basis.
b) Agricultural tax regimes in Ukraine
In Ukraine companies are exempt from
ordinary corporate income tax regime if they
meet criteria to be recognised as agricultural
producers.
In Ukraine, a company is considered to be an
agricultural producer if it derived at least 75%
of its revenue in the previous tax year from the
sales of the self-produced agricultural product.
Simplified agricultural tax means that the
agricultural producer pays tax based not on its
profits, but on the total area used for
agricultural production.
2.16 EMPLOYEE BENEFITS
a) Pension obligations and other post-
employment obligations
The Group does not operate pension schemes
and does not provide post-retirement benefits
to their retirees. Pension obligations may arise
due to a legal obligation to pay for the
incapability to work because of an accident.
The Group has legal obligation to pay
contributions to the state pension funds
according to the local regulations of each
country of location. The contributions to the
local pension funds are treated as social
security tax payments.
b) Termination benefits
Termination benefits are payable when
employment is terminated by the Group before
the normal retirement date, or whenever an
employee accepts voluntary redundancy in
exchange for these benefits.
2.17 PROVISIONS
Provisions for environmental restoration,
restructuring costs, and legal claims are
recognised when: the Group has a present legal
or constructive obligation as a result of past
events; it is probable that an outflow of
resources will be required to settle the
obligation, and the amount can be reliably
estimated. Restructuring provisions comprise
lease termination penalties and employee
termination payments. Provisions are not
recognised for future operating losses.
Provisions are measured at the present value
of the expenditures expected to be required to
settle the obligation using a pre-tax rate that
reflects current market assessments of the
time value of money and the risks specific to
the obligation. The increase in the provision
due to the passage of time is recognised as
interest expense.
2.18 REVENUE RECOGNITION
Revenue is income arising in the course of the
Group’s ordinary activities. Revenue is
recognised in the amount of transaction price.
Transaction price is the amount of
consideration to which the Group expects to be
entitled in exchange for transferring control
over promised goods or services to a customer,
excluding the amounts collected on behalf of
third parties.
2023 ANNUAL REPORT
PAGE 30
Revenue is recognised net of discounts, returns
and value added taxes, export duties, other
similar mandatory payments.
Group's contracts with customers are fixed-
price contracts and generally include both
advance payment and deferred payment for
the same contracts. Generally the sales are
made with a credit term mainly to 2-5 business
days, which is consistent with the market
practice and consequently trade receivables
are classified as current assets.
A receivable is recognised when the goods are
delivered or dispatched based on delivery
terms as this is the point in time that the
consideration is unconditional because only the
passage of time is required before the payment
is due (Note 6). Contract assets are immaterial
and therefore not presented separately in the
consolidated financial statements.
A contract liability is an entity's obligation to
transfer goods or services to a customer for
which the entity has received consideration
from the customer. Contract liabilities are
included in trade and other payables line item
as advances from customers (Note 13).
a) Sales of goods – agricultural produce
The Group’s main revenue arises from the sales
of agricultural produce – grain and milk. The
agricultural produce is subject to quality control
at the point of sale and the sales value is
depending on the quality. Sales are recognised
when control of the good has transferred, being
when the goods are delivered to the customer,
the customer has full discretion over the goods,
and there is no unfulfilled obligation that could
affect the customer's acceptance of the goods.
Delivery occurs when the goods have been
shipped to the specific location, the risks of
obsolescence and loss have been transferred to
the customer, and either the customer has
accepted the goods in accordance with the
contract, the acceptance provisions have
lapsed, or the Group has objective evidence
that all criteria for acceptance have been
satisfied.
b) Sales of biological assets
The Group sells living animals for slaughter.
The revenue from sales of living animals is
recognised after the animals have been
delivered to the slaughterhouse.
c) Sales of services
The Group occasionally sells services to other
agricultural producers. Revenue from the
services is recognised when the service has
been provided.
d) Interest income
Interest income is recognised on a time-
proportion basis using the effective interest
method. When a receivable is impaired, the
Group reduces the carrying amount to its
recoverable amount, being the estimated
future cash flow discounted at the original
effective interest rate of the instrument and
continues unwinding the discount as interest
income. Interest income on impaired loans is
recognised using the original effective interest
rate.
e) Dividend income
Dividend income is recognised when the right
to receive payment is established.
2.19 LEASES
The Group is a party to lease contracts as a
lessee for, the land plots.
Leases are recognized, measured and
presented in line with IFRS 16 Leases.
Land lease rights are measured at cost less any
accumulated depreciation and any
accumulated impairment losses and adjusted
for any re-measurement of the lease liability.
The Group depreciates the land lease rights
from the commencement date to the earlier of
the end of the useful life of the land lease right
asset or the end of the lease term on a straight-
line basis.
The finance cost is charged regarding lease
liabilities to profit or loss over the lease period.
The lease payments are discounted using the
borrowing cost as published by National Bank
of Ukraine on its official web-site
(www.bank.gov.ua) since the interest rate
implicit in the lease could not be determined.
2.20 DIVIDEND DISTRIBUTION
Dividend distribution to the Group’s
shareholders is recognised as a liability in the
Group’s financial statements in the period in
which the dividends are approved by the
Group’s shareholders.
2.21 NON-CURRENT ASSETS HELD FOR
SALE AND DISCONTINUED
OPERATIONS
Non-current assets (or disposal groups) are
classified as held for sale if their carrying
amount will be recovered principally through a
sale transaction rather than through continuing
use and a sale is considered highly probable.
They are measured at the lower of their
2023 ANNUAL REPORT
PAGE 31
carrying amount and fair value less cost to sell,
except for assets such as deferred tax assets,
assets arising from employee benefits, financial
assets.
An impairment loss is recognised for any initial
or subsequent write-down of the asset (or
disposal group) to fair value less cost to sell. A
gain is recognised for any subsequent increases
in fair value less cost to sell of an asset (or
disposal group), but not in excess of any
cumulative impairment loss previously
recognised. A gain or loss not previously
recognised by the date of the sale of the non-
current asset (or disposal group) is recognised
at the date of derecognition.
Non-current assets (including those that are
part of a disposal group) are not depreciated or
amortised while they are classified as held for
sale. Interest and other expenses attributable
to the liabilities of a disposal group classified as
held for sale continue to be recognised.
Non-current assets classified as held for sale
and the assets of a disposal group classified as
held for sale are presented separately from the
other assets in the balance sheet. The liabilities
of a disposal group classified as held for sale
are presented separately from other liabilities
in the balance sheet.
A discontinued operation is a component of the
entity that has been disposed of or is classified
as held for sale and that represents a separate
major line of business or geographical area of
operations, is part of a single coordinated plan
to dispose of such a line of business or area of
operations, or is a subsidiary acquired
exclusively with a view to resale. The results of
discontinued operations are presented
separately in the statement of profit or loss.
3. FINANCIAL RISK MANAGEMENT
3.1 FINANCIAL RISK FACTORS
The Group’s activities expose it to a variety of
financial risks: market risk (including currency
risk, commodity price risk, cash flow interest
rate risk, fair value interest rate risk), credit
risk, liquidity risk and capital repatriation risk.
The Group’s overall risk management program
acknowledges the unpredictability of financial
markets and on the basis of the current
business operations of the Group, the
management is following financial risk
management policies to minimise potential
adverse effects on the Group’s financial
performance from unpredictable fluctuations in
the financial markets. The Group’s centralised
controlling and risk management function
carries out risk management activities on a
day-to-day basis in close cooperation with the
regional management members.
1. Market risk
(i) Foreign exchange risk
The Group operations in Ukraine are exposed
to foreign exchange risk arising primarily from
exposures to the US dollar, Euro, and Ukrainian
hryvna. Foreign exchange risks from US dollar,
Euro, and Ukrainian hryvna arise mainly from
recognised assets and liabilities. The Group has
not implemented any formal currency risk
management policies.
The average value of US dollar relative to euro
depreciated by 2,7% in 2023 (appreciated in
2022 by 11%)
As at 31 December 2023, the exchange rate of
Ukrainian hryvna was 37,9824 UAH/USD (as at
31 December 2022 - 36,5686 UAH/USD).
As at 31 December 2023, the exchange rate of
Ukrainian hryvna was 42,2079 UAH/EUR (as at
31 December 2022 – 38,951 UAH/EUR).
The total recognised decrease in equity from
currency translation differences amounted to
USD 61 383 thousand at December 31, 2023
(USD 59 952 thousand at December 31, 2022)
(Note 18).
(ii) Commodity price risk
The Group is exposed to commodities price risk
because of the significant size of its business
operations in the production of cereals. In case
cereals produced by the Group are primarily
exported, a significant share of the Group’s
revenues will be exposed to global fluctuations
in agricultural commodity prices. The milk
production operations of the Group are to a
2023 ANNUAL REPORT
PAGE 32
lesser extent affected by global commodity
prices since the raw milk is sold regionally and
cannot be exported over long distances.
The Group’s strategy is not to hedge against
any commodity price movements in order to
provide its shareholders a direct exposure to
the fluctuation in the market. Unlike traditional
large-scale farming enterprises that have
typically used a financial hedging strategy to
protect against adverse price fluctuations or
the risks inherent in a highly seasonal business,
the Group does not engage in any commodity
hedging. The Group believes that its diversified
crop rotation system and its combination of
cereal production and dairy farming provide its
business with sufficient operational stability.
(iii) Cash flow and fair value interest rate
risk
As the Group has no significant floating
interest-bearing assets, the Group’s income
and operating cash flows are substantially
independent of changes in market interest
rates.
The Group’s interest rate risk arises from
borrowings (Note 14). Borrowings issued at
variable rates expose the Group to cash flow
interest rate risk. The Group analyses its
interest rate exposure on a dynamic basis.
Various scenarios are simulated taking into
consideration refinancing, renewal of existing
positions and alternative financing.
At 31 December 2023, if interest rates on
floating interest rate borrowings at that date
had been 0.5% higher with all other variables
held constant, net loss for the year would have
been USD 39 thousand higher (2022: USD 29
thousand higher), as a result of higher interest
expense on floating rate borrowings.
The breakdown between floating and fixed interest rates for the existing borrowings of the Group is
shown below:
in USD thousand
31.12.2023
31.12.2022
Borrowings and finance leases (outstanding amount)
Floating rate
7 840
5 724
incl. related to LIBOR
-
26
incl. related to EURIBOR
2 900
82
incl. related to UIRD
4 940
5 616
Fixed rate
13 173
9 156
21 013
14 880
2. Credit risk and counterparty business risk
Credit risk for the Group arises from cash and
cash equivalents, deposits with banks and
financial institutions and customers, including
outstanding receivables and committed
transactions. In respect of banks and financial
institutions, the Group’s policy is to work with
institutions, which have an internationally
reputable strategic shareholder as the majority
investor. (See also Note 5 for details).
3. Liquidity risk
The Group’s main liquidity risks derive from the
cyclical nature of agricultural production. Field-
works in spring and harvest in autumn entails
concentration of costs and working capital need
in the spring season and concentration of
revenues in the autumn season. The cyclicality
is stronger in cereals production and much
lower in dairy production, as dairy production
revenues accrue evenly throughout the whole
operating year. The Group has been lowering
the cyclicality also in cereals production by
acquiring its own warehousing infrastructure to
store grain for longer time periods and to be
able to sell cereal products more evenly
throughout the year. The management
monitors the liquidity risk by following the main
key performance indicators on a continuous
basis, including cash flows.
The undiscounted gross payments of all
borrowings and trade payables are presented
in the included tables. The amounts include
interest payments.
2023 ANNUAL REPORT
PAGE 33
in USD thousand
Total
31.12.2023
On
demand
and less
than 6
months
between 6
and 12
months
between
1 and 2
years
between
2 and
10 years
Maturity
Interest rate
Borrowings and
finance leases
(Note 14)
22 206
14 606
5 732
1 353
515
incl. related to
UIRD
2 467
2 467
-
-
-
2024
UIRD 3m + 9%
incl. related to
UIRD
1 661
1 661
-
-
-
2024
UIRD 3m+ 2,7 %
incl. related to
UIRD
1 119
320
294
505
-
2025-
2026
8,98% - 10,98% +
UIRD 12m
incl. related to
EURIBOR
2 934
2 590
104
240
-
2024-
2026
3,227% + 1m
Euribor; 0,85% +
1m Euribor; 1,6%
+ 7d Euribor
incl. with fixed
interest rate
14 025
7 568
5 334
608
515
2024-
2028
2,8%-20%
Payables (Note 13)
7 749
3 613
3 914
222
-
2024-
2025
no interest rate;
5% for amount of
loans from related
parties
Total
29 955
18 219
9 646
1 575
515
Table above does not include lease liabilities recognized under IFRS 16. As at December 31, 2023
current portion of lease liabilities equaled to USD 3 883 thousand and non-current lease liabilities
equaled to USD 14 592 thousand (Note 22).
in USD thousand
Total
31.12.2022
On
demand
and less
than 6
months
between
6 and 12
months
between
1 and 2
years
between
2 and 10
years
Maturity
Interest rate
Borrowings and
finance leases
(Note 14)
15 658
10 259
3 513
1 654
232
incl. related to
UIRD
2 517
1 258
1 259
-
-
2023
UIRD 3m + 5%
incl. related to
UIRD
1 913
146
1 767
-
-
2023
UIRD 3m + 7 %
incl. related to
UIRD
381
77
71
233
-
2025
UIRD 12m + 8,98
%
incl. related to
UIRD
1 543
317
290
936
-
2025
UIRD 12m + 10,98
%
incl. related to
EURIBOR
82
82
-
-
-
2023
7days EURIBOR +
1,6%
incl. related to
LIBOR
32
32
-
-
-
2023
1mLIBOR + 4,4%
incl. with fixed
interest rate
9 190
8 347
126
485
232
2023-2026
2,8%-20%
Payables (Note 13)
2 971
2 912
57
2
-
2023
no interest rate;
5% for amount of
loans from related
parties
Total
18 629
13 171
3 570
1 656
232
Table above does not include lease liabilities recognized under IFRS 16. As at December 31, 2022
current portion of lease liabilities equaled to USD 3 048 thousand and non-current lease liabilities
equaled to USD 13 456 thousand (Note 22).
2023 ANNUAL REPORT
PAGE 34
3.2 CAPITAL MANAGEMENT
The Group considers as capital its equity and
borrowings.
in USD thousand
31.12.2023
31.12.2022
1
Borrowings (Note
14)
21 013
14 880
Total
shareholders´
equity
56 461
66 918
Capital repatriation risk
The capital repatriation risk derives from the
Group’s investments into Ukrainian subsidiaries.
Potential changes in the political environment in
Ukraine may impose restrictions on repatriating
capital invested as it was historically.
3.3 FAIR VALUE ESTIMATION
The different levels for assets carried at fair
value have been defined as follows:
• Quoted prices (unadjusted) in active
markets for identical assets or liabilities
(Level 1).
• Inputs other than quoted prices included
within level 1 that are observable for the
asset or liability, either directly (that is, as
prices) or indirectly (that is, derived from
prices) (Level 2).
• Inputs for the asset or liability that are not
based on observable market data (that is,
unobservable inputs) (Level 3).
See Note 11 for disclosures of the land that is
measured at fair value, Note 8 for inventories,
Note 9 for biological assets and Note 0 for
borrowings.
4. CRITICAL ACCOUNTING ESTIMATES AND
JUDGMENTS
Estimates and judgments are continually
evaluated and are based on historical
experience and other factors, including
expectations of future events that are believed
to be reasonable under the circumstances.
4.1 CRITICAL ACCOUNTING
ESTIMATES AND ASSUMPTIONS
The Group makes estimates and assumptions
concerning the future. The resulting accounting
estimates will, by definition, rarely equal the
related actual results. The estimates and
assumptions that have a significant risk of
causing a material adjustment to the carrying
amounts of assets and liabilities within the next
financial year are outlined below.
a) Fair value of biological assets
The Group’s biological assets are measured at
fair value less cost to sell at each balance sheet
date (value at December 31, 2023 was
USD 6 310 thousand and value at December
31, 2022 was USD 5 835 thousand) (Note 9).
Variability analysis:
Were the actual prices for the biological assets
in animal husbandry higher by 10% from
management’s estimates, the fair value would
increase by USD 74 thousand (by USD 73
thousand in 2022), if the prices were lower by
10%, the fair value would decrease by the
same amount.
Were the actual crop yields or prices in crop
cultivation higher by 10 % from management
estimates, the fair value would increase by USD
998 thousand as of December 31, 2023 (by
USD 882 thousand as of December 31, 2022),
if crop yields or prices were lower by 10 %, the
fair value would decrease for the same amount.
Were the actual cost per ha in crop cultivation
higher by 10 % from management estimates,
the fair value would decrease by USD 499
thousand as of December 31, 2023 (by USD
417 thousand as of December 31, 2022), if
crop yields were lower by 10 %, the fair value
would increase for the same amount.
b) Useful lives of property, plant, and
equipment
The depreciable items of property, plant, and
equipment amounted to USD 15 989 thousand
2023 ANNUAL REPORT
PAGE 35
as at December 31, 2023 (USD 15 367
thousand as at December 31, 2022) (Note 11).
The remaining balance includes land, which
does not depreciate; and construction in
process. Management has estimated useful
lifetimes for depreciable property, plant, and
equipment. However, the actual useful
lifetimes can be different than those estimated
by the management. If the average useful
lifetime would be 10% longer (shorter) than
estimated by the management, it would
decrease (increase) the depreciation charge by
USD 342 thousand (decrease/increase by USD
280 thousand in 2022).
c) Net realisable value and fair value less cost
to sell of inventories
The Group has its agricultural produce in
inventory as of the year-end (Note 8). The
agricultural produce and inventories for
commodities trading have been valued to fair
value less cost to sell. The fair value of the
grain is determined based on the market
statistics or in case the Group had sold or had
sales contracts for its inventory then those
actual prices were used. Would the prices be
lower (higher) than estimated by 10%, the
value of the inventories would be USD 1 947
thousand less (more) and the equity smaller
(bigger) by the equal amount (in 2022: USD 2
437 thousand).
d) Recoverable values of non-current assets
For the assets in Ukraine impairment test was
carried out as of December 31, 2023 by internal
specialists. The value-in-use method was
applied to determine the recoverable values of
non-current assets. The value in use is based
on estimated future cash flows that are
discounted to their present value applying the
appropriate discount rate. Cash flow was
projected, including revenues, operating
expenses, investment requirements and
working capital needs. Estimated future cash
flows require management to make a number
of assumptions including (but not limited to)
production volumes, prices of agricultural
produce, logistic rates. While determining key
assumptions values applied, both past
experience and external sources information
were taken into account. Production volume
was estimated based on past experience. When
determining selling prices and logistic rates,
the Group analyzed available forecasts for
export and domestic markets. Cost of
production was estimated based on budgeted
costs for the following year inflated by expected
level of inflation. Cash flow forecasts used in
the value in use approach were based on five-
year period estimation (grounded on financial
budget 2024) and extrapolation for periods
over 5 years using the estimated growth rates.
The Group applied 5% of long-term growth
rate. The discount rate applied was 26.25 %.
The test demonstrated that the assets value in
use was higher than the carrying amount of
these assets.
The Group used in the model its target yields
and prices based on forecasts prepared on
current situation and assumption that the
degree of intensity of military hostilities in the
regions where the Group’s assets are located
and the area of the Ukrainian territory currently
invaded by the russian troops will be not
increased; the Group is able to carry out sowing
and harvesting of crops; the railway
infrastructure performs its function and the
Group is able to execute export sales, both by
railway and seaports usage.
However, material uncertainty for the Group in
the future exists just because of external
factors which are out of Management influence,
namely military actions occurring in Ukraine.
War of russia in Ukraine can have impact on
significant assumptions, used in Group’s
forecasts, and thus recoverable values of non-
current assets can be changed. Effect of such
impact cannot be predicted.
Major sensitive inputs 2023:
USD thousand
Change
Impairment
Increase in discount rate
2pp
no
Decrease in terminal
growth rate
1pp
no
For the assets in Ukraine impairment test was
carried out as of December 31, 2022. The
value-in-use method was applied to determine
the recoverable values of non-current assets.
Cash flow was projected, including revenues,
operating expenses, investment requirements
and working capital needs. The Group applied
5.5 % of long-term growth rate. The discount
rate applied was 29.5 %. The test
demonstrated that the assets value in use was
higher than the carrying amount of these
assets.
2023 ANNUAL REPORT
PAGE 36
Major sensitive inputs 2022:
USD thousand
Change
Impairment
Increase in discount rate
2pp
no
Decrease in terminal
growth rate
1pp
no
e) Fair value of land
The fair value of land is reliant on significant
assumptions and unobservable inputs. See
Note 11.1 for the measurement of fair value of
land and financial impact of a potential change
in the value per hectare.
4.2 OTHER RISK FACTORS
RISKS RELATED TO UKRAINIAN LAND
28 April 2020 the President of Ukraine signed
new land law which leads to discrimination of
foreign investors in Ukrainian agriculture. The
key part of new land legislation came into force
in July 2021. Despite discussions about opening
of the land market to the foreigners (except for
citizens of the non-friendly countries), no
amendments have been adopted to remove
discriminatory nature of the law and the foreign
owned companies continue to be prevented
from owning the agricultural land.
4.3 OPERATING ENVIRONMENT
The Group conducts its operations in
Ukraine. Starting on 24 February 2022 the
Ukrainian economy is being damaged of
ongoing russia’s full-scale war against
Ukraine, exposing risks that are not typical
and creating challenges for businesses
located and operating here.
The invasion was preceded by escalation of
russian military aggression against Ukraine
in some areas of Lugansk and Donetsk
regions that started in spring 2014, together
with illegal annexation of Crimea by the
russian federation. In order to repel the
aggressor and protect the sovereignty and
territorial integrity of the state, martial law
was imposed in Ukraine on 24 February
2022, which has extended regularly since
then. The Armed Forces of Ukraine continue
fierce resistance to russian forces.
However, the consequences of military
aggression are currently destruction of
civilian infrastructure, including production
facilities, scaled back and, in some cases,
stopped the operation of certain businesses,
disrupted supply chains, large-scale
displaced of people, and other.
Full-scale war and related security threats
are a key systemic risk to the Ukrainian
economy. Due to significant military
expenditures, the economy will remain
highly dependent on international financial
aid. According to preliminary estimates,
Ukraine's GDP grew by 5% in 2023 after
falling by 28.8% in 2022.
In 2022, the Ukrainian hryvnia significantly
depreciated against major foreign
currencies. Since the beginning of the full-
scale war in Ukraine, a fixed rate regime has
operated. And in the IV quarter of 2023, the
National Bank introduced a regime of
managed flexibility of the exchange rate,
under which the official rate will be
determined by operations on the interbank
foreign exchange market with the active
participation of the NBU. Risks to the stability
of the currency market and the financial
sector did not materialize. In December
2023, the National Bank once again eased a
number of currency restrictions.
At the end of 2023, the Fitch rating agency
confirmed the long-term sovereign rating of
Ukraine in foreign and national currencies at
the level of "ССС/ССС-" and the short-term
sovereign rating of Ukraine in foreign and
national currencies at the level of "C/C". And
in September 2023, according to Standard &
Poor's estimates, the long-term sovereign
rating of Ukraine in foreign and national
currencies for the year was assessed at the
level of "ССС/ССС+" and the short-term
sovereign rating of Ukraine in foreign and
national currencies at the level of "C/C".
The war has significantly impacted the
Group’s business and its performance.
Management continues to make efforts to
identify and mitigate impacts to the Group,
however, there are factors beyond its
knowledge or control, including the duration
and severity of warfare, level of international
support of Ukraine, as well as further
governmental and diplomacy actions taken.
The management’s assessment of the
Group’s ability to continue as a going
concern is detailed in Note 2.1.
2023 ANNUAL REPORT
PAGE 37
5. CASH AND CASH EQUIVALENTS
in USD thousand
31.12.2023
31.12.2022
Cash on hand
1
1
Short-term bank deposits
277
694
278
695
Short-term bank deposits include cash balances at bank accounts, bearing interest of 0%-3.5% on
annualized base (in 2022 0% – 3.5 %)
The credit quality of cash at bank according to banks external credit rating (Moody’s) is given in the
following table:
in USD thousand
31.12.2023
31.12.2022
A1
-
41
A1*
24
-
A2
-
27
A2*
18
-
Aa3
5
-
Aa3*
9
4
Baa1*
39
86
Caa2
5
-
Caa3
2
11
Other
175
525
277
694
* As at December 31, 2023, the parent company ratings were used for the money at AS SEB Bank
(Estonia), AS Swedbank (Estonia), PJSC OTP Bank (Ukraine) and PJSC Credit Agricole Bank (Ukraine),
Raiffeisen Bank (Ukraine) (the same as of December 31, 2022).
6. TRADE AND OTHER RECEIVABLES
in USD thousand
31.12.2023
31.12.2022
Trade receivables
1 905
1 549
Other receivables
13 106
3 747
Prepayments for taxes
5 711
7 720
Prepayments to suppliers
1 585
2 918
Total receivables and prepayments
22 307
15 934
Less non-current portion:
Prepayments for non-current assets
-467
-1 334
Other receivables
-8 173
-110
Total non-current portion
-8 640
-1 444
Current portion
13 667
14 490
The fair values of trade and other receivables are
not materially different from the carrying values
based on the expected discounted cash flows.
Prepayment for taxes consist mainly of VAT
receivable balance. After reporting date, in 2024
Group obtained VAT budget compensation in
amount USD 2 860 thousand (UAH 92 151
thousand and EUR 405 thousand).
All non-current receivables are due within more
than one year from the balance sheet date. Non-
current prepayments will realize in non-current
assets, like property, plant, and equipment.
The split of cash between currencies:
in USD thousand
31.12.2023
31.12.2022
Ukrainian hryvna
97
283
US dollar
3
27
Euro
175
350
Other currencies
3
35
278
695
2023 ANNUAL REPORT
PAGE 38
Other receivables include current receivable in
amount USD 12 609 thousand from related
parties as at December 31, 2023 (USD 2 660
thousand as at December 31, 2022). The Group
also had amount payable to related party in
amount USD 4 532 thousand as at December 31,
2023 (USD 564 thousand as at December 31,
2022) (Note 29). Thus, net amount receivable
from related parties equaled USD 8 077
thousand as at December 31, 2023.
For a breakdown of trade and other receivables
by category please refer to Note 7.
The ageing of trade receivables is as follows:
in USD thousand
31.12.2023
31.12.2022
including receivables not due
1 853
1 459
including receivables overdue up to 3 months
5
11
including receivables overdue up 3 to 6 months
19
22
including receivables overdue over 6 months
28
57
The ageing of other receivables is as follows:
in USD thousand
31.12.2023
31.12.2022
including receivables not due
13 106
3 732
including receivables overdue up to 3 months
-
-
including receivables overdue over 6 months
-
15
Overdue trade receivables are not considered
impaired based on the individual assessment of
each significant receivable.
The credit quality of trade receivables that are
not overdue can be assessed by reference to
external credit ratings (if available) or to
historical information about counterparty default
rates:
in USD thousand
31.12.2023
31.12.2022
Group 1
1 668
1 229
Group 2
182
227
Group 3
3
3
Total unimpaired trade receivable
1 853
1 459
Group 1 – new customers/related parties (less than 6
months).
Group 2 – existing customers/related parties (more than 6
months) with no defaults in the past.
Group 3 – existing customers/related parties (more than 6
months) with some defaults in the past. All defaults were
fully recovered.
As at December 31, 2023, Other receivables not
due are from counterparties with no or some
defaults in the past (no or some defaults in the
past in as at December 31, 2022).
in USD thousand
2023
2022
At January 1
-
-
Provision for receivables impairment
-
-
Receivables written off during the year as uncollectible
-
-
Provision recovery
-
-
Currency translation differences
-
-
At December 31
-
-
2023 ANNUAL REPORT
PAGE 39
The carrying amounts of the Group’s trade and other receivables are denominated in the following
currencies:
in USD thousand
31.12.2023
31.12.2022
US dollar
11 508
14
Ukrainian hryvna
4
582
Euro
667
3 508
Czech koruna
2 832
1 192
15 011
5 296
The maximum exposure to credit risk arising
from trade and other receivables at the reporting
date is the carrying amount of each class of
receivable mentioned above. The Group does
not hold any collateral as security for the trade
receivable
7. FINANCIAL INSTRUMENTS BY CATEGORY
In USD thousand
31.12.2023
31.12.2022
Assets as per balance sheet
Loans and
receivables
Loans and
receivables
Cash and cash equivalents (Note 5)
278
695
Trade and other receivables excluding prepayments (Note 6)
15 011
5 296
15 289
5 991
31.12.2023
31.12.2022
Liabilities as per balance sheet
Financial
liabilities at
amortised
cost
Financial
liabilities at
amortised
cost
Trade and other payables excluding social security, other
taxes and prepayments from clients (Note 13)
7 749
2 970
Borrowings excluding lease liabilities (Note 14)
19 710
13 459
Lease liabilities (Note 14)
1 303
1 421
Land lease liability (Note 22)
18 475
16 504
47 237
34 354
Prepayments are excluded as this analysis is required only for financial assets.
8. INVENTORIES
Inventory breakdown, USD thousand
31.12.2023
31.12.2022
1
Grain for sale
19 471
24 371
Raw materials, supplies
3 652
4 659
Fieldworks in process
2 984
2 228
Total
26 107
31 258
Incl. own produced inventory
23 151
24 902
2023 ANNUAL REPORT
PAGE 40
in USD thousand
2023
2022
1
At 1 January
24 902
24 895
Changes in balances of finished product stocks**:
-3 035
7 659
- Agricultural production recognized at the fair value (Note 9)
24 633
25 664
- Dairy production recognized at the fair value
1 733
3 169
- Capitalization of costs to fieldworks in process
1 537
2 146
- Reclassification from fieldworks in process to biological assets at the
moment of seeding
-635
-2 632
- Cost of own production on realization to third parties
-31 925
-23 580
- Inventory revaluation
1 622
2 892
For internal use*
-280
-1 023
Currency translation differences
1 564
-6 629
At 31 December
23 151
24 902
*Own produced inventory for internal use includes seeds, fertilizers and animal feed, which are presented in the
Income statement on the line Raw materials and consumables used for production purposes (Note 20).
** Changes in balances of finished product stocks include amount USD 128 thousand from discontinued operations.
Changes in balances of finished products from continuing operations is USD 7 531 thousand for the year 2022.
Inventories that are measured at fair value are
categorized under Level 2 in the fair value
hierarchy, as defined by IFRS 13.
Grain for sale is revalued by the Group on each
balance sheet date using contracted and market
prices.
Own produced inventories are measured at net
realizable value. In determining the NRV (net
realizable value), the Group also considers
existing sales agreements at balance sheet date,
and actual sales transactions by the Group
shortly after the balance sheet date.
As at December 31, 2023 inventories at carrying
value of USD 3 234 thousand were pledged for
the benefit of banks. As at December 31, 2022
inventories at carrying value of USD 3 649
thousand were pledged for the benefit of banks.
Breakdown of the grain for sale, agricultural
produce inventory, 31.12.2023
Grain for sale,
agricultural
produce, USD
thousand
Tonnes
Average price
used, USD/t
Wheat
3 229
21 232
152
Sunflower
8 823
26 610
332
Corn
5 660
40 576
140
Rapeseed
-
-
-
Soya
333
816
408
Canary
-
-
-
Millet
8
65
123
Mustard
1 408
2 656
530
Other
10
448
23
Total
19 471
92 403
211
Breakdown of the grain for sale, agricultural
produce inventory, 31.12.2022 (recalculated)
Grain for sale,
agricultural
produce, USD
thousand
Tonnes
Average
price used,
USD/t
Wheat
6 158
34 744
177
Sunflower
7 013
20 963
334
Corn
5 395
27 088
199
Rapeseed
1 976
3 902
507
Soya
2 032
4 868
417
Canary
80
110
727
Millet
595
2 846
209
Mustard
718
540
1 330
Other
404
2 379
170
Total
24 371
97 440
250
2023 ANNUAL REPORT
PAGE 41
9. BIOLOGICAL ASSETS
in USD thousand
Plant
cultivation
Animal
husbandry
Total
Carrying amount at 31.12.2022
5 107
728
5 835
Non-current biological assets
7
728
735
Current biological assets
5 100
-
5 100
2023
Gain/loss arising from changes in fair value less estimated point
of sale costs of biological assets*:
721
76
797
- Increases due to new plantations/birth
25 406
368
25 774
- Harvest (Note 8)
-24 633
-
-24 633
- Decreases due to written-off biol.assets
-52
-292
-344
- Other changes in fair value
-
-
-
Currency translation differences
-259
-63
-322
Carrying amount at 31.12.2023
5 569
741
6 310
Non-current biological assets
-
741
741
Current biological assets
5 569
-
5 569
in USD thousand
Plant
cultivation
Animal
husbandry
Total
Carrying amount at 31.12.2021
1 670
796
2 466
Non-current biological assets
3
796
799
Current biological assets
1 667
-
1 667
2022
Gain/loss arising from changes in fair value less estimated point of
sale costs of biological assets*:
4 279
90
4 369
- Increases due to new plantations/birth
30 048
348
30 396
- Harvest (Note 8)
-25 665
-
-25 665
- Decreases due to written-off biol.assets
-104
-258
-362
- Other changes in fair value
-
-
-
Currency translation differences
-842
-158
-1 000
Carrying amount at 31.12.2022
5 107
728
5 835
Non-current biological assets
7
728
735
Current biological assets
5 100
-
5 100
Animals,
pcs
Winter
crops,
hectares
Unharvested
corn,
hectares
Physical quantities at 31.12.2023
1 095
10 511
433
Physical quantities at 31.12.2022
1 172
9 314
141
As at the balance sheet date, Current biological
assets in plant cultivation include winter crops
seeded for the next harvest and also corn at
433 hectares, that was not harvested in 2023.
Current biological assets in plant cultivation
include also grasslands, which are used for
harvesting animal feed. Non-current assets in
animal husbandry include dairy herd, both
mature and immature. Animal husbandry is
measured at fair value less cost to sell.
The gain arising from changes in fair value
includes changes in both physical quantities
due to the growth of plants/animals and
changes in market prices of the biological
assets.
Fair value of biological assets sown for next
year harvest is determined by present valuing
the net cash flows expected to be generated
from the assets discounted at average cost of
short-term financing. The fair value of
biological assets is determined by the Group’s
own agricultural and IFRS experts. The
valuation of the biological assets (winter wheat
and winter rapeseed, corn) is within level 3 of
the fair value hierarchy.
2023 ANNUAL REPORT
PAGE 42
Winter crops seeded in 2023 for the next year
and unharvested corn are determined by
valuing the net cash flows expected to be
generated from the assets discounted at
average cost of short-term financing.
The following inputs and assumptions were
made to determine the fair value of biological
assets:
- revenue from the crops sales is projected
based on the expected volume of crop
harvested;
- prices are projected based on budget data for
next year;
- production and costs to sell are projected
based on budget data for next year;
-a discount rate 26.665% is applied in
determining fair value of biological assets as of
December 31, 2023 (38.28% as of December
31, 2022).
The significant unobservable inputs used in the
fair value measurement of the crops as of
31.12.2023 are as follows:
Yields of crops (6,28 tons per hectare for winter
wheat, 2,88 tons per hectare for winter
rapeseed, 10,15 tons per hectare for corn).
Prices of crops (UAH 6 411 per ton for winter
wheat and UAH 14 078 per ton for winter
rapeseed, UAH 4 978 per ton for corn).
The significant unobservable inputs used in the
fair value measurement of the crops as of
31.12.2022 were as follows:
Yields of crops (5,93 tons per hectare for winter
wheat, 2,94 tons per hectare for winter
rapeseed, 7,62 tons per hectare for corn).
Prices of crops (UAH 6 276 per ton for winter
wheat and UAH 19 561 per ton for winter
rapeseed, UAH 6 199 per ton for corn).
The fair value of the livestock is based on the
valuation from the independent valuator. The
valuator used the market prices of livestock of
similar age, breed and genetic merit based on
the relevant market, taking into account
transaction prices on the most advantageous
market, and the market situation in the dairy
sector. The fair value measurements are
categorized under Level 2 in the fair value
hierarchy, as defined by IFRS 13. In 2023, the
gain from revaluating 1 095 animals was
recorded at USD 3 thousand in the Income
Statement (in 2022 the gain from revaluating
1 172 animals in amount USD 62 thousand in
the Income Statement). In total, the fair value
of the herd (1 095 animals), as of December
31, 2023, stood at USD 741 thousand. In total,
the fair value of the herd (1 172 animals), as
of December 31, 2022, stood at USD 728
thousand.
As at December 31, 2023, biological assets in
Ukraine were pledged at a value of USD 605
thousand for the benefit of the bank. As at
December 31, 2022, biological assets in
Ukraine were pledged at a value of USD 2 811
thousand for the benefit of the bank.
In the year 2023 harvest of cereals was at the
level of 140 335 net tonnes (2022: 102 251 net
tonnes). Milk production for the year 2023 was
5 004 tonnes (4 858 tonnes for the year 2022).
2023 ANNUAL REPORT
PAGE 43
10. INTANGIBLE ASSETS
As of December 31, 2023 there were 8 051,51
ha under emphyteusis agreements (As of
December 31, 2022 – 7 702,96 ha).
in USD thousand
Software
Land-usage
rights under
emphyteusis
Total
31.12.2022
Cost
106
11 874
11 980
Accumulated amortization
-93
-450
-543
Net book amount
13
11 424
11 437
2023
Additions
-
796
796
Amortization charge
-2
-249
-251
Disposal
-2
-148
-150
Currency translation
differences
2
-518
-516
Closing net book amount
11
11 305
11 316
31.12.2023
Cost
103
12 017
12 120
Accumulated amortization
-92
-712
-804
Net book amount
11
11 305
11 316
in USD thousand
Software
Land-usage
rights under
emphyteusi
s
Total
31.12.2021
Cost
135
14 216
14 351
Accumulated amortization
-123
-282
-405
Net book amount
12
13 934
13 946
2022
Additions
5
1 648
1 653
Amortization charge
-1
-264
-265
Disposal
-
-228
-228
Currency translation
differences
-3
-3 666
-3 669
Closing net book amount
13
11 424
11 437
31.12.2022
Cost
106
11 874
11 980
Accumulated amortization
-93
-450
-543
13
11 424
11 437
2023 ANNUAL REPORT
PAGE 44
11. PROPERTY, PLANT AND EQUIPMENT
The Group’s additions of property, plant and
equipment during 2023 amounted to
USD 5 972 thousand (USD 5 302 thousand in
2022).
During 2023 and 2022 there were no significant
changes at land market, thus land carrying
value as of December 31, 2023 is considered to
be as fair (as of December 31, 2019 land was
revaluated using the market approach by
independent valuators).
in USD thousand
Land
Buildings
Vehicles &
machinery
Furniture,
fittings &
equipment
Construction
in process
Total
31.12.2022
Cost
2 639
4 704
29 093
1 973
1 002
39 411
Accumulated depreciation
-
-1 526
-17 790
-1 087
-
-20 403
Net book amount
2 639
3 178
11 303
886
1 002
19 008
2023
Additions
103
162
2 755
723
2 229
5 972
Disposals
-
-
-162
-7
-
-169
Reclassification balance sheet
items/between groups
-
334
-58
646
-922
-
Depreciation charge
-
-316
-2 304
-800
-
-3 420
Currency translation
differences
-120
-88
-248
-15
-124
-595
Closing net book amount
2 622
3 270
11 286
1 433
2 185
20 796
31.12.2023
Cost
2 622
4 460
29 825
3 193
2 185
42 285
Accumulated depreciation
-
-1 190
-18 539
-1 760
-
-21 489
Net book amount
2 622
3 270
11 286
1 433
2 185
20 796
in USD thousand
Land
Buildings
Vehicles &
machinery
Furniture,
fittings &
equipment
Construction
in process
Total
31.12.2021
Cost
3 638
6 009
30 796
1 279
1 047
42 769
Accumulated depreciation
-
-1 404
-15 730
-1 090
-
-18 224
Net book amount
3 638
4 605
15 066
189
1 047
24 545
2022
Additions
5
-
3 687
44
1 566
5 302
Disposals
-
-4
-1 701
-13
-
-1 718
Reclassification balance sheet
items/between groups
-
-
338
826
-1 164
-
Depreciation charge
-
-492
-2 236
-72
-
-2 800
Currency translation
differences
-1 004
-931
-3 851
-88
-447
-6 321
Closing net book amount
2 639
3 178
11 303
886
1 002
19 008
31.12.2022
Cost
2 639
4 704
29 093
1 973
1 002
39 411
Accumulated depreciation
-
-1 526
-17 790
-1 087
-
-20 403
Net book amount
2 639
3 178
11 303
886
1 002
19 008
2023 ANNUAL REPORT
PAGE 45
Impairment test was carried out as of
December 31, 2023. The value-in-use method
was applied to determine the recoverable
values of non-current assets. Cash flows were
projected, including revenues, operating
expenses, investment requirements and
working capital needs. The Group applied 5%
long-term growth rate. The discount rate
applied was 26.25%. The test demonstrated
that the assets value in use was higher than the
carrying amount of these assets (Note 4.1.d).
Impairment test was carried out as of
December 31, 2022. The value-in-use method
was applied to determine the recoverable
values of non-current assets. Cash flows were
projected, including revenues, operating
expenses, investment requirements and
working capital needs. The Group applied 5.5%
long-term growth rate. The discount rate
applied was 29.5%. The test demonstrated that
the assets value in use was higher than the
carrying amount of these assets (Note 4.1.d).
In 2023 the Group was provided with grants,
associated with assets in form of aid to build
elevator buildings capacities (USD 660
thousand) and in form of maxibegs (USD 1 299
thousand), used for agroproduce transporting,
within project “Economic support of Eastern
Ukraine”, financed by USAID in accordance
with contract, concluded based on Agreement
between Ukraine and USA government on
humanitarian and technical-economic
cooperation. During 2023 maxibegs under
grants were amortized for amount USD 337
thousand and thus, income was recognized
respectively. At the balance sheet as at
December 31, 2023 current part of deferred
income from subsidies is recognized in amount
USD 651 thousand and non-current part of
deferred income from subsidies is recognised in
amount USD 971 thousand correspondingly.
Land, buildings, machinery, vehicles and
equipment in Ukraine were pledged at a
carrying value of USD 10 228 thousand (2022:
USD 5 565 thousand).
The net book value of assets leased (vehicles
and machinery) as at December 31, 2023,
stood at USD 1 810 thousand (as at December
31, 2022, USD 1 484 thousand).
11.1 FAIR VALUE OF LAND
The fair value of freehold land as at December
31, 2023, is USD 2 622 thousand (USD 2 639
thousand as at December 31, 2022).
Fair value is based on active market prices,
adjusted, if necessary, for any difference in the
nature, location or condition of the specific
asset. If this information is not available, the
Group uses alternative valuation methods,
such as recent prices on less active markets or
discounted cash flow projections. The valuation
of the land in Ukraine as at December 31, 2019
was performed by Company “Proconsul” LLC.
Sales comparison approach was applied for the
land. It is a valuation methodology whereby the
subject property is compared to recently sold
or to sales quotes of properties of a similar
nature with fair value determined through the
application of positive and negative
adjustments for their differing attributes.
Unobservable inputs within the sales
comparison approach:
Size adjustment – the valuer’s assessment of
the price differential between the valued
property and compared property attributable to
their size difference.
Location adjustment – the valuer’s assessment
of the price differential between the valued
property and compared property attributable to
differences in their location.
Bargaining discount – the valuer’s assessment
of the average price discount generally
obtained compared to quoted asking prices of
property.
Relationship of unobservable inputs to fair
value: The fair value measurements listed
above are all sensitive to a significant increase
(decrease) in the unobservable inputs. The
higher the rate per hectare, the higher the fair
value.
If the value per hectare had been 10%
higher/lower, the fair value of land as at
December 31, 2023, would have been USD 262
thousand higher/lower in Ukraine.
During 2023 and 2022 there were no significant
changes at land market. Land was not
revaluated by independent appraisers as of
December 31, 2023. Thus, carrying value of
land as of December 31, 2023 is considered to
be as fair.
2023 ANNUAL REPORT
PAGE 46
12. PREPAID LAND RENTS AND LAND USAGE
RIGHTS
The Group’s land in Ukraine is used mainly
based on lease agreements. The Group has
made prepayments or has recognised land
usage rights in business combinations to get
access to that land in previous periods. These
prepayments and land usage rights are
amortised during the period of the lease.
in USD thousand
31.12.2023
31.12.2022
Balance at the beginning of the period
160
246
Amortization recognised
-24
-27
Unrealised exchange rate differences
-6
-59
Balance at the end of the period
130
160
13. TRADE AND OTHER PAYABLES
in USD thousand
31.12.2023
31.12.2022
Trade payables
2 478
2 116
Prepayments from clients
34
487
Social security and other taxes
1 129
1 605
Accrued expenses
568
655
Amounts due to related parties (Note 29)
4 532
569
Other payables
483
53
9 224
5 485
Less: non-current portion (Note 29)
-223
-4
9 001
5 481
As of December 31, 2023 payables to related
parties are denominated: USD 4 496 thousand
in Euro, USD 22 thousand in Czech Koruna and
USD 14 in Ukrainian hryvnia.
As of December 31, 2022 payables to related
parties are denominated: USD 538 thousand in
Euro and USD 31 thousand in Czech Koruna.
The carrying amounts of the Group’s financial
liabilities (trade and other payables, excluding
prepayments, tax liabilities and payables to
employees) are denominated in the following
currencies:
in USD thousand
31.12.2023
31.12.2022
US dollar
674
54
Ukrainian hryvna
1 480
1 447
Euro
5 447
1 418
Czech koruna
148
51
7 749
2 970
2023 ANNUAL REPORT
PAGE 47
14. BORROWINGS
The total borrowings of the Group as at
December 31, 2023, amounted to USD 21 013
thousand (USD 14 880 thousand as at December
31, 2022).
Details of the borrowings’ currencies, interest
rates, and maturities are shown in the included
tables. Total finance costs in 2023 amounted to
USD 2 300 thousand (USD 786 thousand in
2022) (Note 25).
in USD thousand
31.12.2023
31.12.2022
Current
Bank borrowings
18 690
12 772
Finance lease payables
635
493
19 325
13 265
Non-current
Bank borrowings
1 020
687
Finance lease payables
668
928
1 688
1 615
Total borrowings
21 013
14 880
31.12.2023, in USD thousand
31.12.2023
Maturity
Interest rate
USD-nominated
4 216
2024
2,8%-6,9%
EUR-nominated
4 660
2024-2028
4,86%-5,9%
EUR-nominated
2 479
2024
1m Euribor + 0,85%
EUR-nominated
5
2024
7d Euribor + 1,6%
CZK-nominated
67
2027
5,50%
UAH-nominated
4 229
2024
17%-20%
UAH-nominated
1 592
2024
2,7% + UIRD (3m)
UAH-nominated
1 303
2025-2026
5,37%-23,01%
UAH-nominated
1 231
2024
UIRD 3m + 9,0%, from
which the state
compensates UIRD 3m
UAH-nominated
1 231
2024
UIRD 3m + 9,0%, from
which the state
compensates UIRD 3m
21 013
Less: non-current portion
-1 688
19 325
Less accrued interest
-212
Current portion excl accrued interest
19 113
2023 ANNUAL REPORT
PAGE 48
31.12.2022, in USD thousand
31.12.2022
Maturity
Interest rate
USD-nominated
2 621
2023-2027
2,8%-3,85%
EUR-nominated
2 086
2023
2,75%
EUR-nominated
82
2023
7days EURIBOR + 1,6%
UAH-nominated
4 449
2023
18%-20%
UAH-nominated
1 668
2023
7% + UIRD (3m)
UAH-nominated
26
2023
1mLIBOR + 4,4%
UAH-nominated
1 395
2025
12,29%-23,01%
UAH-nominated
1 270
2023
1,94%, market rate 18%,
from which the state
compensates 16,06%
(UIRD 3m+5%)
UAH-nominated
1 283
2023
7,05%, market rate 18%,
from which the state
compensates 10,95%
(UIRD 3m)
14 880
Less: non-current portion
-1 615
13 265
Less accrued interest
-177
Current portion excl accrued interest
13 088
31.12.2023
31.12.2022
Bank
borrowings
Lease
payables
Bank
borrowings
Lease
payables
Floating rate:
– Expiring within one year
6 537
635
4 303
493
– Expiring beyond one year
-
668
-
928
Fixed rate:
– Expiring within one year
12 153
-
8 469
-
– Expiring beyond one year
1 020
-
687
-
19 710
1 303
13 459
1 421
31.12.2023
31.12.2022
in USD thousand
Bank
borrowings
Lease
payables
Bank
borrowings
Lease
payables
US dollar
4 217
-
2 621
-
Euro
7 145
-
2 168
-
CZK
67
-
-
-
Ukrainian hryvna
8 281
1 303
8 670
1 421
19 710
1 303
13 459
1 421
2023 ANNUAL REPORT
PAGE 49
in USD thousand
Cash
Leases
due
within 1
year
Leases due after 1
year
Borrow.
due
within 1
year
Borrow.
due after
1 year
Total
Net debt as at 31
December 2022*
695
-493
-928
-12 595
-687
-14 008
Cash flows
-508
723
-
-2 586
-3 785
-6 156
Acquisitions-finance
leases and lease
incentives
-
-271
-394
-
-67
-732
Foreign exchange
adjustments
91
28
32
10
212
373
Other non-cash
movements
-
-622
622
-3 307
3 307
-
Net debt as at 31
December 2023*
278
-635
-668
-18 478
-1 020
-20 523
* Net debt reconciliation is shown excluding the interest liability
in USD thousand
Cash
Leases
due
within 1
year
Leases due after 1
year
Borrow.
due
within 1
year
Borrow.
due after
1 year
Total
Net debt as at 31
December 2021*
1 456
-576
-34
-60
-
786
Cash flows
-1 711
922
-
-11 584
-772
-13 145
Acquisitions-finance
leases and lease
incentives
-
-956
-1 056
-
-
-2 012
Foreign exchange
adjustments
950
154
125
-722
-144
363
Other non-cash
movements
-
-37
37
-229
229
-
Net debt as at 31
December 2022*
695
-493
-928
-12 595
-687
-14 008
* Net debt reconciliation is shown excluding the interest liability
Total future finance lease minimum payments
in USD thousand
31.12.2023
31.12.2022
up to 12 months
824
787
1-5 years
744
1 170
1 568
1 957
Future interests
265
536
Present value of the lease
1 303
1 421
The fair value of borrowings equals their
carrying amount, as the impact of discounting
is not significant or market rates are not
significantly different from actual borrowing
rates. The borrowings are classified as Level 3
under the fair value hierarchy, as defined by
IFRS 13.
2023 ANNUAL REPORT
PAGE 50
15. INCOME TAX
in USD thousand
2023
2022
Current tax:
Current tax on profits for the year
264
131
Adjustments in respect of prior years
-16
16
Income tax expenses from discontinued operations
-
Total current tax
248
147
Deferred tax (Note 16):
Origination and reversal of temporary differences
-3
-3
Transfer to discontinued operations
-
-
Total deferred tax
-3
-3
Income tax expense/(profit)
245
144
The tax on the group’s profit before tax differs from the theoretical amount that would arise using the
weighted average tax rate applicable to profits of the consolidated entities as follows:
in USD thousand
2023
2022
1
Profit/loss before tax*
-8 780
-12 713
Profit/Loss before tax from entities not subject to Income tax by statutory
legislation
-8 808
-25 496
Profit/loss before tax from entities subject to income tax
28
12 783
Tax calculated at domestic tax rates applicable to profits in the respective
countries
2
2 809
Tax effects of:
Income not subject to tax
-45
-4 569
Expenses not deductible for tax purposes
181
1 641
Utilisation of previously unrecognised tax losses
-21
-
Tax losses for which no deferred income tax asset was recognised
144
247
Adjustments in respect of prior years
-16
16
Transfer to discontinued operations
-
-
Tax charge
245
144
The Group does not have material deferred tax
assets or liabilities in companies, which are
active in agricultural production. This is due to
the following reasons:
1) All of the Group companies in Ukraine that
are producing agricultural produce are not
subject to income tax but to the unified
agricultural tax. The agricultural tax is based on
hectares of arable land the company uses, not
on its earnings and therefore no deferred tax
arises. All other companies in Ukraine
(companies that are related to sales and
trading and storage elevators) are under
regular tax regime and subject to income tax.
2) The Group company in Czech republic is
subject to income tax at rate 19% . The Group
company in Czech republic is holding
companies which generate accounting losses.
The non-tax duductible expenses are
permanent (refreshment and non-deductible
part of paid interest) so there are no temporary
differences between the tax and accounting
bases of assets and liabilities
2023 ANNUAL REPORT
PAGE 51
16. DEFERRED TAX
The analysis of deferred tax assets and deferred tax liabilities is as follows:
in USD thousand
2023
2022
Deferred tax assets:
– Deferred tax assets to be recovered after more than 12 months
-
-
– Deferred tax asset to be recovered within 12 months
-
-
-
-
Deferred tax liabilities:
– Deferred tax liability to be recovered after more than 12 months
36
42
– Deferred tax liability to be recovered within 12 months
-
-
36
42
Deferred tax liabilities (net)
36
42
The gross movement on the deferred income tax account is as follows:
in USD thousand
2023
2022
At 1 January
42
60
Currency translation differences
-3
-15
Income statement charge related to change in deferred tax assets/ liability
(Note 15)
-3
-3
Tax charge /(credit) relating to components of other comprehensive income
-
-
Classified as associated with assets classified as held for sale
-
-
At 31 December
36
42
Deferred income tax assets are recognized for
tax loss carry-forwards to the extent that the
realization of the related tax benefit through
future taxable profits is probable. The group did
not recognise deferred income tax assets of
USD 144 thousand (USD 251 thousand in
2022) in respect of losses amounting to USD
699 thousand (USD 1 279 thousand in 2022)
that can be carried forward against future
taxable income. The accumulated amount of
tax losses where tax asset was not recognized
as at December 31, 2023 was USD 33 273
thousand (2022: USD 34 044 thousand) that
can be carried forward against future taxable
income. Losses amounting to USD 33 273
thousand (USD 32 548 thousand in 2022) have
unlimited usage and the rest of losses will
expire during 1 to 5 years.
The movement in deferred income tax assets and liabilities during the year is as follows:
2023 ANNUAL REPORT
PAGE 52
Deferred tax liabilities
Accelerated
tax
depreciation
Other
Total
At 31 December 2021
26
34
60
Charged/(credited) to the income statement
-3
-
-3
Currency translation differences
-15
-
-15
At 31 December 2022
8
34
42
Charged/(credited) to the income statement
-3
-
-3
Currency translation differences
-3
-
-3
At 31 December 2023
2
34
36
Deferred tax assets
Other
Total
At 31 December 2021
-
-
Charged/(credited) to the income statement
-
-
Currency translation differences
-
-
At 31 December 2022
-
-
Charged/(credited) to the income statement
Currency translation differences
-
-
At 31 December 2023
-
-
17. SHARE CAPITAL
in USD thousand
Number of
shares
Incl. ordinary
shares
Share
capital
Share
premium
Total
31.12.2021
74 685 369
74 685 369
8 696
92 263
100 959
31.12.2022
74 685 369
74 685 369
8 696
92 263
100 959
31.12.2023
74 685 369
74 685 369
8 696
92 263
100 959
As at December 31, 2023 and as at December
31, 2022, the total number of issued shares was
74,685,369 with a par value of 0.10 EUR. All
shares have been fully paid.
In the year 2021 the decision was made to
decrease nominal value of parent company
Agromino A/S share. The nominal value of shares
was decreased from EUR 1 to EUR 0.1 and share
capital was reduced correspondingly from USD
28 061 thousand to USD 2 806 thousand (EUR
24 895 thousand to EUR 2 489 thousand). Such
a decrease resulted in share premium increase
for USD 25 255 thousand (EUR 22 406
thousand) and then share premium increase was
set off against accumulated deficit.
On 1 June 2021, a decision to increase the share
capital to USD 8 696 thousand (EUR 7 469
thousand) by way of a cash contribution of EUR
0.24 per nominally EUR 0.10 new share was
adopted by Agromino’s board of directors.
In August 2021 share premium was set off with
accumulated deficit for amount USD 87 155
thousand (EUR 89 147 thousand).
The shares of Agromino A/S were listed on the
main market of Small Cap segment on NASDAQ
Stockholm. On 15 July 2020, Agromino
announced its plan to apply for delisting of
Agromino’s shares. On 19 October 2020, Nasdaq
Stockholm has approved such application. The
last day of trading of Agromino’s shares was 30
October 2020.
2023 ANNUAL REPORT
PAGE 53
18. OTHER RESERVES
in USD thousand
Revaluation
of land*
Translation
differences
Total
31.12.2021
669
-52 550
-51 881
Currency translation differences
-
-17 886
-17 886
Currency translation difference recycled from
Other Comprehensive Income to Income
Statement in relation to disposal of subsidiary
-
10 484
10 484
31.12.2022
1
669
-59 952
-59 283
Currency translation differences
-
-1 431
-1 431
Currency translation difference recycled from
Other Comprehensive Income to Income
Statement in relation to disposal of subsidiary
-
-
-
31.12.2023
669
-61 383
-60 714
As at December 31, 2023, land reserve (related
to land in ownership) amounts to USD 669
thousand (December 31, 2022: USD 669
thousand) included in Other reserves
attributable to the holders of the parent.
19. REVENUE AND OTHER INCOME
in USD thousand
2023
2022
Sales of cereals
51 629
33 508
Sales of milk
1 838
1 714
Revenue from elevator services
14
62
Other revenue
401
332
TOTAL revenue
53 882
35 616
Subsidies
-
-
Other income
749
91
Total other income
749
91
In 2023, 22% of revenue is generated from
sales to customers in Ukraine and 78 % -
export sales (in 2022 – 21 % and 79 %
correspondingly).
Revenues of USD 8 076 thousand (2022: USD
6 271 thousand) are derived from one external
customer, revenues of USD 6 006 thousand
(2022: USD 3 026 thousand) are derived from
the second external customer and revenues of
USD 4 780 thousand (2022: 2 810 thousand)
are derived from the third external customer.
2023 ANNUAL REPORT
PAGE 54
20. RAW MATERIALS AND CONSUMABLES USED
FOR PRODUCTION PURPOSES
in USD thousand
2023
2022
Seeds, fertilizers, chemicals
12 045
9 283
Animal feed
1 173
1 242
Repairs
2 142
1 247
Fuel, gas, electricity
3 820
3 640
Land tax and land rental
694
812
Transport services
16 025
10 680
Other services and materials
2 320
2 895
38 219
29 799
21. EMPLOYEE BENEFITS EXPENSE
in USD thousand
2023
2022
Wages and salaries
4 611
4 683
Social security costs
1 080
1 015
5 691
5 698
Remuneration to the Board of Directors and
Executive Board is disclosed in Note 29.
22. RIGHT-OF-USE ASSET AND LEASE
LIABILITY
Amounts recognized in the balance sheet
The balance sheet shows the following amounts relating to land leases:
in USD thousand
31.12.2023
31.12.2022
Right-of-use assets
Land
14 186
13 716
Land usage rights from business acquisition*
4 817
5 719
Other
507
-
19 510
19 435
Land lease liabilities
Non-current
14 592
13 456
Current portion
3 883
3 048
Total lease liabilities
18 475
16 504
*The Group has recognized land usage rights
related to the acquisition of Resilient as of the
date of acquisition October 17, 2019. Balance
value of land usage rights acquired was USD 4
817 thousand as of December 31, 2023 (USD
5 719 thousand as of December 31, 2022).
2023 ANNUAL REPORT
PAGE 55
Amounts recognised in the statement of profit or loss
The statement of profit or loss shows the following amounts relating to leases:
in USD thousand
2023
2022
Depreciation charge of right-of-use assets (under IFRS 16)
1 790
1 411
Depreciation charge of land-usage rights from business acquisition
1 084
1 391
Interest expense on land lease liabilities (included in finance cost)
3 599
2 968
Movements for the right-of-use assets were the following:
in USD thousand
2023
2022
Cost as of 1 January
28 362
32 230
Accumulated depreciation
-8 927
-7 696
Net book value as at 1 January
19 435
24 534
Additions to the right-of-use assets
792
-
Depreciation
-2 874
-2 802
Other movements (including changes to agreements)
2 847
2 898
Disposals
-200
-321
Currency translation differences
-490
-4 874
Cost as of 31 December
31 106
28 362
Accumulated depreciation
-11 596
-8 927
Net book value as at 31 December
19 510
19 435
Movements for the land lease liability were the following:
in USD thousand
2023
2022
Land lease liability as at 1 January
-16 504
-18 456
Non-current
-13 456
-14 805
Current
-3 048
-3 651
Additions to the lease liability
-792
-
Financial costs from continuing operations
-3 599
-2 968
Other movements (including changes to agreements)
-2 847
-2 898
Disposals
224
372
Repayment
4 130
2 388
Currency translation differences
913
5 058
Land lease liability as at 31 December
-18 475
-16 504
Non-current
-14 592
-13 456
Current
-3 883
-3 048
2023 ANNUAL REPORT
PAGE 56
23. OTHER ADMINISTRATIVE EXPENSES
in USD thousand
2023
2022
Legal and consulting fees
478
513
Office and administration expenses
1 067
853
Other expenses
148
195
1 693
1 561
24. OTHER (LOSSES)/GAINS-NET
in USD thousand
2023
2022
Write down of doubtful receivables and prepayments
-118
-8
Foreign exchange losses/gains net
89
1 134
Currency translation difference recycled from Other Comprehensive Income
to Income Statement in relation to disposal of subsidiaries
-
-10 484
Other losses / gains net
-312
136
-341
-9 222
25. FINANCE INCOME AND FINANCE COST
in USD thousand
2023
2022
Interest income
443
155
Other financial income
-
-
443
155
Interest expense at effective interest rate:
Finance lease liabilities (Note 14)
-355
-100
Bank borrowings (Note 14)
-1 945
-686
Lease land liabilities (Note 22)
-3 599
-2 968
Related parties (Note 29)
-23
-18
Other finance costs
-1
-3
-5 923
-3 775
26. CONTINGENCIES
TAXES
UKRAINE:
Tax legislation. Ukrainian tax, currency, and
customs legislation is subject to varying
interpretations, and changes, which can occur
frequently. Management’s interpretation of
such legislation as applied to the transactions
and activity of the Group may be challenged by
the relevant regional and central authorities.
The tax authorities in Ukraine may be taking a
more assertive position in their interpretation
of the legislation and assessments, and it is
possible that transactions and activities that
have not been challenged in the past may be
challenged. As a result, significant additional
taxes, penalties, and interest may be assessed.
Fiscal periods remain open to review by the
authorities in respect of taxes for three
calendar years preceding the year of review.
Under certain circumstances, reviews may
cover longer periods.
The tax consequence of transactions for
Ukrainian taxation purposes is frequently
determined by the form in which transactions
are documented and the underlying accounting
treatment prescribed by Ukrainian GAAP.
One of the Group companies acts as claimant
in lawsuit with the tax authorities. Based on the
results of the documentary inspection
concerning the period from October 1, 2016 to
September 30, 2019, the State Tax Authority
of Ukraine in Kyiv issued tax decision regarding
decrease in negative value of object of
corporate income tax in the total amount of
USD 2 474 thousand (UAH 94 506 thousand).
2023 ANNUAL REPORT
PAGE 57
The same decision also set out that the
respective Group company’s VAT liability
should increase by the amount of USD 97
thousand (UAH 3 658 thousand) and should
pay penalties in the total amount of USD 37
thousand.
The Group disagreed with assessment made by
the State Tax Authority in Kyiv and,
accordingly, respective Group company filed an
administrative lawsuit with the District
Administrative Court of Kyiv to cancel the
above decisions.
On December 8, 2020, the District
Administrative Court of Kyiv decided to cancel
part of the decision concerning the income tax
and maintained in force part concerning the
VAT assessment.
This decision was appealed by the Group (in
part concerning the VAT) and was upheld by
the decision of the Sixth Appeal Administrative
Court on April 6, 2021.
Negative consequences of the decision on the
Group in part concerning VAT were reflected by
the respective Group company in its financial
statements in April 2021 and the corresponding
amounts of payments were paid to the state
budget. However, the Group company filed a
cassation appeal to the Supreme Court of
Ukraine and is persuaded that the assessment
of the case made by the first instance court and
appellate court was incorrect and, hence,
decisions will be overturned by the Supreme
Court of Ukraine. If that will occur, the VAT
payments made by the company in April 2021
will be returned to the company.
In December 2023 Supreme Court returned
lawsuit decision regarding object of corporate
income tax for re-examination to set actual
circumstances in regards of claimant’s relations
with counterparties by courts. The claimant
gathered additional evidences, including
written confirmations of counterparties,
received as responds for attorney’ requests,
copies of primary documents were also
provided by counterparties. The Group
company also initiated presence of claimant
representatives, who took part in business
operations of the claimant, in the court session.
On the other hand, Tax authority position is
based only on availability of insignificant flaws
in primary documents. The Group evaluates
result of judicial re-examination as positive in
all probability based on additional evidences
gathered and submitted to the court.
LITIGATIONS:
One of the Group companies (the Silo located
in 5 km near border with russia) acts as a
defendant in a lawsuit with bankrupted farm
enterprise represented by the bankruptcy
trustee.
The region in which the Silo is located was
occupied during February-September 2022 by
russian army and during the harvest season the
Silo itself was under control of the third parties
collaborating with the occupation forces.
During mentioned period the assets and grain
were stolen from the Silo and the new grain
was delivered to the Silo as well. After the
deoccupation of eastern part of Kharkiv oblast
in September 2022, the Group found in the Silo
part of grain which it was able to identify as
well as part of the grain to which reliable
ownership documents were missing. All
discovered grain was in a very poor condition –
wet, dirty, unpleasant smell, and full of insects
(independent survey was done). The access to
the Silo was, for understandable reasons,
restricted by the local SBU and military for
almost 2 months after deoccupation. Hence,
possibility to ensure standard treatment of the
grain at the Silo for an extended period of time
was very limited. The risk of further decay of
the grain, risk of repeated occupation of the
Silo, as well as the risk of Silo destruction was
extremely high. Accordingly, acting with due
care Agromino sought ways to protect the
remaining assets with undocumented owners
stored at the Silo from further damage.
Since no one had approached the Silo with
proper documents proving ownership to the
outstanding part of the grain for more than six
months after the de-occupation of eastern
Kharkiv region, Agromino decided, based on
Ukrainian law, to approve sale such part of the
grain whose owners had not approached the
Elevator for its claim with proper confirmation
of their rights. The money from the sale of the
grain were deposited to be subsequently
transferred to such owners of the grain who will
confirm their rights to it. Thus, the grain was
converted into money according to the law (i.e.
in the interest of the third party), thereby
eliminating the risks of further loss of values.
In the second half of 2023 third party at the
claimant side contacted Agromino´s top
management, declaring they have indirect
claims to a bankrupted farm enterprise that
allegedly also placed his grain into Agromino
2023 ANNUAL REPORT
PAGE 58
subsidiary´s Silo. No reliable grain ownership
documents were presented by the claimant
side. To prevent any misconduct and payout of
money to non-owner, third party / the claimant
side was asked to solve this issue via
commercial court which will determine the
question of whether the grain was owned by
the claimant or not.
Court of the first instance concluded to allow a
claim against Group company and to charge
amount USD 361 thousand (or UAH 13 807
thousand) from the Group company. Due to
many reasons the Group considered such court
conclusion unfair and filed an appeal. The
appeal court recently upheld the decision of the
first instance and thus confirmed that the grain
(despite absence of documents clearly
stipulated by law) belonged to the bankrupted
farmer company and that, despite conditions in
the de-occupied region and constant and
documented shelling of the area, the grain was
of poor quality due to lack of oversight of the
Silo, who is in turn liable for damages (circa
UAH 7 800 thousand).
Given the circumstances of the case, the fact
that the hearing of appeal court took literally
few minutes and all requests (incl. for the
expert opinion regarding falsified documents)
of Silo´s attorneys were refused without any
explanation, the Group is convinced that the
appeal court did not assess the case
independently and objectively. Hence, the
Group in cooperation with top notch attorneys
is preparing extraordinary appeal to have the
case and the conduct of the judges (which is
also disputed under the case) reviewed by the
Supreme Court of Ukraine. Given the
circumstances, the Group is firmly convinced
that the decisions of the lower instances will not
be upheld by the Supreme Court of Ukraine as
such decisions lack any merits, clearly
contradict Ukrainian law. These aspects are
almost entirely excluded at the level of the
Supreme Court of Ukraine which allows the
Group to have firm believe that the decision of
the courts of lower instances will be entirely
overturned.
27. COMMITMENTS
Within the framework of the share purchase
agreement (SPA) for the acquisition of 100% of
shares of Resilient a.s. (Shares) in October
2019 a pledge over the Shares was established
by the Company in favour of Mabon investiční
fond s proměnným kapitálem a.s. (Mabon).
Mabon is controlled by Mr. Petr Krogman, who
is also the Chairman of the Agromino‘s Board
of Directors.
The pledge shall secure potential future
liabilities of the Company towards Mabon which
may arise mainly in case of substantial breach
of limited warranties by Agromino under the
SPA. No liabilities towards Mabon under the
framework of the SPA exist on the date of this
report. The Company assesses the risk of
origination of substantial liabilities under the
framework of the SPA as very low.
Consequently, the Company assesses the risk
of pledge realization as very low.
During the process of the SPA negotiation
applicable disqualification rules were respected
by the Company.
2023 ANNUAL REPORT
PAGE 59
28. GROUP STRUCTURE
The Group’s parent company Agromino A/S
registered in Denmark.
As of December 31, 2023, and 2022, the Group included the following companies:
Country of
registration
Segment
Ownership
percentage
in 2023
Ownership
percentage
in 2022
Legal
Status in
the Group
Agromino A/S
Denmark
-
100%
100%
Parent
company
LLC Trigon Farming Kharkiv
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Trigon Agro 2
Ukraine
Ukraine
100%
100%
Subsidiary
Private Enterprise Trigon Farming
Molniya
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Trigon Farming
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Trigon-Export
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Kovyagovskoye Zerno
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Kovyaqovskoуe
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Vovchanskiy Combinat
Khliboproduktiv
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient
Ukraine
Ukraine
99.99%
99.99%
Subsidiary
LLC Resilient Agro
Ukraine
Ukraine
100%
100%
Subsidiary
Private Rental Agricultural
Enterprise Sydory
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Oliynykova Sloboda,
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Pryvitiv
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Stara Synyava
Ukraine
Ukraine
100%
100%
Subsidiary
Private enterprise, Trans Agro
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Matyushi
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Saturn Agrokom
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Agrocompany Bilotserkivska
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Bilotserkivska
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Pryvitivske
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Agrocompany Matyushi
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Oliynykova Sloboda
Ukraine
Ukraine
100%
100%
Subsidiary
LLC Resilient Sydory
Ukraine
Ukraine
100%
100%
Subsidiary
Resilient a.s.
Czech
Republic
-
100%
100%
Subsidiary
TC Farming Ukraine Ltd.
Cyprus
-
100%
100%
Subsidiary
TC Farming Russia Ltd.
Cyprus
-
100%
100%
Subsidiary
In the year ended December 31, 2022 the Group
divested group companies LLC Trigon Moloko,
LLC Dobruchi-2, and liquidated company Trigon
Farming Aktsiaselts.
2023 ANNUAL REPORT
PAGE 60
29. RELATED PARTY TRANSACTIONS
Related parties comprise of companies which are
controlled by the Group´s management
personnel or the members of the Board of
Directors.
During the reporting period the Group had not
sales and purchases operations with related
parties.
The following table sets forth the aggregate gross amounts of salaries and other remuneration by the
Group to the members of its Board of Directors and Executive Board in 2023 and in 2022.
in USD thousand
Salary (incl
social security
costs)
Total
2023
Members of Board of Directors
13
13
Members of the Executive Board
308
308
321
321
2022
Members of Board of Directors
13
13
Members of the Executive Board
263
263
276
276
As of December 31, 2023, the Group had
liability to Board of Directors members in the
amount of USD 3 thousand (USD 3 thousand as
of December 31, 2022).
During the reporting period the Group had the following balances outstanding and operations with
related parties:
31.12.2023
31.12.2022
Loans receivable from related parties (Companies under control of
Members of Board of Directors)
4 748
2 660
Receivables towards related parties
7 861
-
Loans payable from related parties (Companies under control of
Members of Board of Directors)
-605
-564
Payables to related parties
-3 914
-
Other payable to related parties (Companies under control of
Members of Board of Directors)
-13
-
Sales to related parties (Companies under control of Members of
Board of Directors)
37
-
Purchases from related parties (Companies under control of
Members of Board of Directors)
1 310
-
Movement in Loans payable from related parties
(Companies under control of Members of Board of
Directors)
in USD thousand
12m 2023
12m 2022
Beginning of the year
564
726
Loans advanced
-
4
Loan repayments made
-
-137
Interest charged
23
18
Interest paid
-
-1
Currency translation differences
18
-46
End of the period
605
564
Loans payable to related parties have maturity within year 2024. Interest rate is 5% per loan contracts
(5 % in 2022).
2023 ANNUAL REPORT
PAGE 61
30. FEES TO THE AUDITORS APPOINTED BY THE
SHAREHOLDERS
In 2023 and 2022 expenses to auditors were:
in USD thousand
2023
2022
Audit, assurance engagements and other services
105
77
31. DISPOSAL OF SUBSIDIARIES
In June 2022 a share purchase agreement for
the sale of company LLC “Trigon Moloko”
(russian milk segment, since LLC “Trigon
Moloko” is 100 % holder of LLC Dobruchi-2) has
been signed. The consideration for sale of
russian milk segment was USD 2,1 million (RUB
101 thousand for sale of LLC “Trigon Moloko”
corporate rights and EUR 2 000 thousand for
further sale of receivables from LLC “Dobruchi-
2” by the Group).
The net assets of subsidiaries disposed at the
date of disposal were as follows:
2023 ANNUAL REPORT
PAGE 62
in USD thousand
2022
ASSETS
Current assets
Cash and cash equivalents
200
Trade and other receivables
307
Inventories
595
Biological assets
417
Current assets
1 519
Other non-current prepayments and receivables
-
Intangible assets
-
Property, plant and equipment
3 104
Biological assets
2 881
Right-of-use asset
-
Non-current assets
5 985
Total assets
7 504
LIABILITIES
Borrowings
27
Trade and other payables
298
Current portion of lease liability
-
Current liabilities
325
Borrowings
81
Trade and other payables
63
Lease liability
-
Deferred tax liabilities
-
Non-current liabilities
144
Total liabilities
469
Impairment
-5 013
Net assets derecognized
2 022
Consideration received:
Cash
2 022
in USD thousand
2022
Consideration received
2 022
Net assets derecognized
-2 022
Gain on disposal (Note 24)
-
Currency translation difference recycled from Other
Comprehensive Income to Income Statement in
relation to disposal of subsidiary (Note 24)
-10 484
Result of subsidiaries disposal
-10 484
2023 ANNUAL REPORT
PAGE 63
The combined results of the discontinued operations are set out below.
Results from discontinued operations for year ended 31 December:
in USD thousand
2023
2022
Discontinued operations:
Revenue
-
1 267
Other income
-
108
Gain/loss of biological assets arising from changes in fair value less cost to
sell
-
310
Total revenue, other income and fair value adjustments
-
1 685
Net changes in inventories of agricultural produce and work in
process
-
128
Cost of purchased goods for trading purposes
-
-
Raw materials and consumables used for production purposes
-
-1 362
Employee benefits expense
-
-236
Depreciation and amortization
-
-119
Other administrative expenses
-
-21
Other (losses)/gains - net
-
-14
-
61
Gains/losses from exchange rate differences
-
-
Finance income
-
-
Finance costs (Note 22)
-
-
Share of profit/loss of investments accounted for using the equity method
-
-
-
Profit/loss before income tax
-
61
Corporate income tax
-
-
Profit/loss for the period from
-
61
Cash flows from discontinued operations for year ended 31 December
in USD thousand
2023
2022
Net cash (outflows)/inflows from operating activities
-
55
Net cash outflows from investing activities
-
-26
Net cash inflows/(outflows) from financing activities
-
-24
Net decrease in cash and cash equivalents
-
5
2023 ANNUAL REPORT
PAGE 64
32. EVENTS AFTER THE BALANCE SHEET DATE
The Group finished its spring sowing campaign
successfully and is preparing for its harvesting
campaign.
In 2024 the Group obtained VAT budget
compensation in amount USD 2 860 thousand
(UAH 92 151 thousand and EUR 405 thousand).
The Group has a silo located in Vovchansk. In
the beginning of May 2024 russian military
forces began recurring attack at the North of
Kharkiv region, including attack of Vovchansk
city. Value of property, plant and equipment
located in the territory of active hostilities is
near USD 1 220 thousand and near USD 30
thousand of inventories. The Group replaced its
blocked silo capacity in Volchansk region
already in 2023 by building new storage
capacities in the volume 16 thousand tonnes in
Kovyagi region under USAID grant. So grain is
carried to and stored at other two owned silos
(subsidiaries) and third parties’ silos, there are
no issues for Group’s operation activity due to
blocked silo capacity in Volchansk region. Silo
in Vovchansk is located in the part of the city
which is not frontline and is separated by river
from the russian military forces. About 16
thousand hectares of Group land under
cultivation is located near territories where
hostilities are taking place. 6 thousand
hectares out of them have not been cultivated
since February 24, 2022. Land, located near
territories where hostilities are taking place,
has the worst harvest indicators for the Group.
Management takes possible measures to
minimize potential losses in relation to military
operations. The Group believes that latest
geopolitical events (G7 Summit, Ukraine Peace
Summit in Switzerland) will help in efforts of
Ukrainian army to expel russian forces from
North of Kharkiv region and the Group will be
able to use its assets, as it was after de-
occupation in 2022.
The final resolution and the effects of
continuing russian war against Ukraine are
difficult to predict, but they may have further
severe effects on the Ukrainian economy and
the Group’s business. Management continues
to make efforts to identify and mitigate impacts
to the Group, however, there are factors
beyond Management knowledge or control,
including the duration and severity of warfare,
as well as further governmental and
diplomacy actions taken.
2023 ANNUAL REPORT
PAGE 65
FINANCIAL STATEMENTS OF THE PARENT
COMPANY
STATEMENT OF FINANCIAL POSITION OF THE
PARENT COMPANY
in USD thousand
Note
31.12.2023
31.12.2022
ASSETS
Current assets
Cash and cash equivalents
5
10
10
Trade and other receivables
7
3 798
4 020
3 808
4 030
Non-current assets
Investments in subsidiaries
6
36 361
36 189
36 361
36 189
Total assets
40 169
40 219
LIABILITIES
Current liabilities
Trade and other payables
8
276
238
Borrowings
9
35
33
311
271
Non-current liabilities
Borrowings
9
-
-
-
-
Total liabilities
311
271
EQUITY
Capital and reserves attributable to equity
holders of the Company
Ordinary shares
10
8 696
8 696
Share premium
10
92 263
92 263
Other reserves
-45 227
-46 631
Accumulated deficit
-15 874
-14 380
Total equity
39 858
39 948
Total equity and liabilities
40 169
40 219
The notes on pages 68 to 77 are an integral part of the parent company financial statements.
2023 ANNUAL REPORT
PAGE 66
STATEMENT OF THE COMPREHENSIVE INCOME OF
THE PARENT COMPANY
in USD thousand
Note
2023
2022
Revenues
11
169
5
Other income
-
-
Employee benefits expense
12
-377
-256
Other expenses
-200
-366
Impairment losses
14
-1 107
-8 333
Gains/losses from exchange rate differences
-52
82
Interest income
13
74
97
Interest expense
13
-1
-16
Profit/loss from sale of investments
-
-3 608
Net loss before income tax
-1 494
-12 395
Corporate income tax
-
-16
Net loss for the period
-1 494
-12 411
Other comprehensive income
1 404
-3 409
Total comprehensive loss for the period
-90
-15 820
STATEMENT OF CHANGES IN EQUITY FOR THE
PARENT COMPANY
In USD thousand
Share
capital
Share
premium*
Other
reserves
Accumulated
deficit
Total
Balance at 31.12.2021
8 696
92 263
-43 222
-1 969
55 768
Total comprehensive income (loss) for the period
-
-
-3 409
-12 411
-15 820
Balance at 31.12.2022
8 696
92 263
-46 631
-14 380
39 948
Total comprehensive income (loss) for the period
-
-
1 404
-1 494
-90
Balance at 31.12.2023
8 696
92 263
-45 227
-15 874
39 858
* Share premium can be distributed as dividend.
The notes on pages 68 to 77 are an integral part of the parent company financial statements.
2023 ANNUAL REPORT
PAGE 67
STATEMENT OF CASH FLOWS OF THE PARENT
COMPANY
In USD thousand
Note
2023
2022
Cash flows from operating activities
Cash receipts from customers
11
68
119
Cash paid to suppliers and employees
12,13,16
-564
-647
Income tax paid
-
-82
Net cash used in/generated from operating
activities
-496
-610
Cash flows from investing activities
Contribution to share capital of subsidiary
15
-
Acquisition of subsidiary, net of cash acquired
15
-
Sale of subsidiary
-
Loans issued to subsidiaries
15
-17
-1 837
Loans issued to related parties
15
-
-230
Proceeds from share capital decrease of subsidiary
-
-
Proceeds from loan repayments from subsidiaries
15
-
2 158
Proceeds from interest repayments from subsidiaries
15
-
608
Net cash used in/generated from investing
activities
-17
699
Cash flows from financing activities
Loans received from subsidiaries
15
519
-
Loans received from related parties
15
-
4
Loans repaid to subsidiaries
15
-6
-5
Interest repaid to subsidiaries
15
-
-
Loans repaid to related parties
15
-
-137
Interest repaid to related parties
-
-2
Shares issue
-
-
Net cash generated from used in financing
activities
513
-140
Net increase in cash and cash equivalents
-
-51
Effects of exchange rate changes on cash and cash
equivalents
-
-5
Cash and cash equivalents at beginning of period
5
10
66
Cash and cash equivalents at end of period
5
10
10
The notes on pages 68 to 77 are an integral part of the parent company financial statements.
2023 ANNUAL REPORT
PAGE 68
NOTES TO THE FINANCIAL STATEMENTS OF
THE PARENT COMPANY
1. GENERAL INFORMATION
The Company was established on December
11, 2006. Agromino A/S (“the Company”) is
the parent company of the Agromino Group.
The Company is a limited liability company
incorporated and domiciled in Denmark. The
address of its registered office is c/o
Advokatfirmaet Poul Schmith, Kalvebod Brygge
32, DK-1560, Copenhagen, Denmark.
The Parent Company has in 2011 established a
branch "Agromino Eesti Filiaal" in Estonia.
The Company belongs to C (large) accounting
class according to Danish Financial Statements
Act.
The Company prepares its separate financial
statements in accordance with IFRS and further
requirements in the Danish Financial
Statements Act.
The principal accounting policies applied in the
preparation of these financial statements are
set out below.
2. ACCOUNTING PRINCIPLES
Basis of preparation of the financial statements
of the parent company
The financial statements of Agromino A/S have
been prepared in accordance with International
Financial Reporting Standards, as adopted by
the EU (IFRS) and further requirements in the
Danish Financial Statements Act. The parent
company has applied the same accounting
policies as the Group, except for the
investments in subsidiaries as described below.
See Note 2 to the Consolidated Financial
Statements, for the summary of significant
accounting policies of the Group.
Long-term investments in subsidiaries and
associate companies
In the separate financial statements of the
parent company, the investments in
subsidiaries are recognised and measured at
cost. Equity interests in foreign currencies are
translated to the reporting currency using the
historical exchange rate prevailing at the time
of the transaction. Where cost exceeds the
recoverable amount, the carrying value is
written down to the recoverable amount.
Dividends from investments in subsidiaries,
joint ventures, and associates are recognized
as income in the financial year when the
dividends are distributed.
3. CRITICAL ACCOUNTING ESTIMATES
An impairment test was performed at
investments in subsidiaries as at December 31,
2023 and December 31, 2022.
For the purpose of impairment testing, parent
company identified two cash-generating units
(CGUs): investments in Ukrainian subsidiaries
(located in eastern part of Ukraine);
investment in Czech Republic subsidiary
(Resilient a.s.), that in its turn holds
investments in other Ukrainian subsidiaries of
the Group (located more in central part of
Ukraine). The recoverable amount of
investments (cash-generated units) is
determined as value-in-use. Investments in
Cyprus companies are analyzed for impairment
based on their fair value on net assets ground.
Based on the test performed, impairment of
investment in Czech Republic subsidiary,
holding investments in Ukraine subsidiaries in
its turn, was recognized in 2023 (Note 14). The
impairment test has shown a need for
impairment, as the expected operating profit
does not currently correspond to the
investments in Resilient a.s. Thus, carrying
amount of investments is higher than
2023 ANNUAL REPORT
PAGE 69
investments value in use as at December 31,
2023.
The value in use is based on estimated future
cash flows that are discounted to their present
value applying the appropriate discount rate.
Cash flow was projected, including revenues,
operating expenses, investment requirements
and working capital needs. Estimated future
cash flows require management to make a
number of assumptions including (but not
limited to) production volumes, prices of
agricultural produce, logistic rates. While
determining key assumptions values applied,
both past experience and external sources
information were taken into account.
Production volume was estimated based on
past experience. When determining selling
prices and logistic rates, available forecasts
were analyzed. Cost of production was
estimated based on budgeted costs for the
following year inflated by expected level of
inflation. Cash flow forecasts used in the value
in use approach were based on five-year period
estimation (grounded on financial budget
2024) and extrapolation for periods over 5
years using the estimated growth rates.
The parent company has applied 5% long-term
growth rate that has been aggregated from the
long-term growth perspective in the respective
country and estimation of the growth in food
prices in relation to other inputs. The discount
rate applied 26,25%.
In the model target yields and prices were used
based on forecasts prepared on current
situation and assumption that the degree of
intensity of military hostilities in the regions
where the subsidiaries assets are located and
the area of the Ukrainian territory currently
invaded by the russian troops will be not
increased; company’s subsidiaries are able to
carry out sowing and harvesting of crops; the
railway infrastructure performs its function and
is used as a way of executing export sales as
well as seaports are used.
However, material uncertainty in the future
exists just because of external factors which
are out of Management influence, namely
military actions occurring in Ukraine. War of
russia in Ukraine can have impact on significant
assumptions, used in Parent company’s and
Group’s forecasts, and thus recoverable values
of investments in subsidiaries can be changed.
Effect of such impact cannot be predicted.
Based on the test performed as of December
31, 2022 impairment of investments in Cyprus
subsidiary and Czech Republic subsidiary,
holding investments in Ukraine subsidiaries,
was recognized in 2022 (Note 14). The
impairment test has shown a need for
impairment, as the expected operating profit
did not correspond to the increased
investments in Resilient a.s. Thus, carrying
amount of investments was higher than
investments value in use as at December 31,
2022.
The parent company has in the model as at
December 31, 2022 used its target yields and
prices for cereals and milk based on forecasts.
The parent company has applied 5.5% long-
term growth rate that has been aggregated
from the long-term growth perspective in the
respective country and estimation of the
growth in food prices in relation to other inputs
for Ukrainian segment. The discount rate
applied in Ukraine 29,5%.
4. FINANCIAL RISK MANAGEMENT
Financial risk management principles of
Agromino A/S correspond to the principles used
for the whole Group. For further information on
the financial risk management principles used
please refer to the consolidated financial
statements Note 3. For details concerning the
parent company please refer to the other Notes
of the financial statements of the parent
company.
The Company is exposed to foreign exchange
risk arising primarily from exposures to the US
dollar. Refer to Notes 7,8,9 for the amounts of
assets and liabilities nominated in the US
dollar.
2023 ANNUAL REPORT
PAGE 70
5. CASH AND CASH EQUIVALENTS OF THE PARENT
COMPANY
in USD thousand
31.12.2023
31.12.2022
Cash at bank and on hand
10
10
10
10
As at December 31, 2023 (and December 31, 2022) there was no cash on bank deposits. The credit
rating (Moody`s) of the banks where the cash was held was Aa3.
6. LONG TERM INVESTMENTS IN SHARES OF
SUBSIDIARIES
Breakdown of investments in subsidiaries by companies is given in the table below:
in USD thousand
31.12.2023
31.12.2022
TC Farming Ukraine Ltd.
2
2
LLC Kovyaqovskoуe
2 490
2 403
RESILIENT A.S.
20 032
20 428
LLC Trigon Farming Kharkiv
8 811
8 505
CJSC Vovchanskiy Combinat Khliboproduktiv
1 964
1 896
Private Enterprise Trigon Farming Molniya
1 727
1 667
LLC Trigon Farming
774
747
LLC Kovyagivske Zerno
553
534
LLC Trigon Agro 2
8
7
36 361
36 189
During 2022 the Company has made non-
monetary share capital contribution into
subsidiary in amount of USD 9 012 thousand
(EUR 8 558 thousand).
In 2022 the Company sold its share in LLC
Trigon Moloko. Subsidiary Trigon Farming Ltd.
was liquidated in 2022.
Impairment of investments in subsidiaries have
been recognized in 2023 and 2022 (Note 14).
2023 ANNUAL REPORT
PAGE 71
As of December 31, 2023, the parent company owned directly the following companies:
2023
Country of
registration
Segment
Ownership
persentage
Legal Status
in the Group
LLC Kovyaqovskoуe
Ukraine
Ukraine
100%
Subsidiary
LLC Kovyaqovskoуe Zerno
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Farming Kharkiv
Ukraine
Ukraine
99,8712%
Subsidiary
CJSC Vovchanskiy Combinat
Khliboproduktiv
Ukraine
Ukraine
100%
Subsidiary
Private Enterprise Trigon
Farming Molniya
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon-Export
Ukraine
Ukraine
0,03%
Minority
interest
LLC Trigon Farming
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Agro 2
Ukraine
Ukraine
8,78%
Minority
interest
Resilient a.s.
Czech Republic
-
100%
Subsidiary
TC Farming Ukraine Ltd.
Cyprus
-
100%
Subsidiary
TC Farming Russia Ltd.
Cyprus
-
100%
Subsidiary
As of December 31, 2022, the parent company owned directly the following companies:
2022
Country of
registration
Segment
Ownership
persentage
Legal Status
in the Group
LLC Kovyaqovskoуe
Ukraine
Ukraine
100%
Subsidiary
LLC Kovyaqovskoуe Zerno
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Farming Kharkiv
Ukraine
Ukraine
99,8712%
Subsidiary
CJSC Vovchanskiy Combinat
Khliboproduktiv
Ukraine
Ukraine
100%
Subsidiary
Private Enterprise Trigon Farming
Molniya
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon-Export
Ukraine
Ukraine
0,03%
Minority
interest
LLC Trigon Farming
Ukraine
Ukraine
100%
Subsidiary
LLC Trigon Agro 2
Ukraine
Ukraine
8,78%
Minority
interest
Resilient a.s.
Czech Republic
-
100%
Subsidiary
TC Farming Ukraine Ltd.
Cyprus
-
100%
Subsidiary
TC Farming Russia Ltd.
Cyprus
-
100%
Subsidiary
2023 ANNUAL REPORT
PAGE 72
7. TRADE AND OTHER RECEIVABLES
in USD thousand
31.12.2023
31.12.2022
Current receivables:
Receivables from subsidiaries (Note 15)
1 511
1 406
Short-term loans given to subsidiaries (Note 15)
1 625
2 009
Short-term loans given to related parties
632
591
Total current receivables
3 768
4 006
Current prepayments:
Prepayments
-
-
Prepayments for indirect taxes
30
14
30
14
Total current receivables and prepayments
3 798
4 020
Breakdown of the receivables from subsidiaries and group companies by companies is given below:
in USD thousand
31.12.2023
31.12.2022
TC Farming Ukraine Ltd.
31
10
LLC Trigon Farming Kharkiv
1 462
1 462
TC Farming Russia Ltd
31
30
Resilient a.s.
1 612
1 913
Total receivables
3 136
3 415
During 2023 and 2022 no receivables or loans
from the group companies were impaired.
Trade and other receivables are not due as at
December 31, 2023, and December 31, 2022.
The carrying amounts of the trade and other receivables were denominated in the following
currencies:
in USD thousand
31.12.2023
31.12.2022
US dollar
-
Czech koruna
54
52
Euro
3 744
3 968
3 798
4 020
2023 ANNUAL REPORT
PAGE 73
8. TRADE AND OTHER PAYABLES
in USD thousand
31.12.2023
31.12.2022
Trade payables
11
3
Trade payables to related parties (Note 15)
-
-
Social security and other taxes
6
5
Accrued expenses
140
115
Amounts due to related parties (Note 15)
119
115
276
238
Less: non-current portion
-
-
276
238
The carrying amounts of the trade and other payables were denominated in the following currencies:
in USD thousand
31.12.2023
31.12.2022
US dollar
-
-
Euro
276
238
276
238
9. BORROWINGS
in USD thousand
31.12.2023
31.12.2022
Current
Borrowings from subsidiaries (Note 15)
-
-
Borrowings from Related parties (Note 15)
35
33
Finance lease payables
-
-
35
33
Non-current
Borrowings from Related parties (Note 15)
-
-
-
-
Total borrowings
35
33
in USD thousand
31.12.2023
31.12.2022
Euro
35
33
35
33
10. SHARE CAPITAL OF THE PARENT COMPANY
in USD thousand
Number of
shares
Incl.
ordinary
shares
Share
capital
Share
premium
Total
31.12.2021
74 685 369
74 685 369
8 696
92 263
100 959
31.12.2022
74 685 369
74 685 369
8 696
92 263
100 959
31.12.2023
74 685 369
74 685 369
8 696
92 263
100 959
2023 ANNUAL REPORT
PAGE 74
As at December 31, 2023 and as at December
31, 2022, the total number of issued shares was
74,685,369 with a par value of 0.10 EUR. All
shares have been fully paid.
11. REVENUE
in USD thousand
2023
2022
Sales of services
169
5
TOTAL revenue
169
5
Sale of services includes revenue from related
parties in amount USD 169 thousand (2022:
USD 5 thousand) (Note 15)
12. EMPLOYEE BENEFITS EXPENSE
in USD thousand
2023
2022
Fees of Members of Board of Directors and
Executive Board (Note 15)
186
122
Social security costs related to fees of Members of
Board of Directors and Executive Board (Note 15)
122
66
308
188
Wages and salaries
52
51
Social security costs
17
17
69
68
377
256
2023 ANNUAL REPORT
PAGE 75
13. FINANCE INCOME AND FINANCE COST
in USD thousand
2023
2022
Interest income from group companies (Note 15)
53
78
Interest income from related parties (Note 15)
21
19
TOTAL interest income
74
97
Interest expense from group companies (Note 15)
-
-14
Interest expense from related parties (Note 15)
-1
-2
TOTAL interest expense
-1
-16
14. IMPAIRMENT LOSSES
in USD thousand
2023
2022
Impairment of investments (Note 6)
-1 107
-8 333
-1 107
-8 333
15. RELATED PARTY TRANSACTIONS
in USD thousand
Sales and purchases
2023
2022
Sale of services to group companies (Note 11)
169
5
Including re-charged expenses
-
1
Interest income from group companies (Note 13)
53
78
Interest income from related parties (Note 13)
21
19
Interest expense from group companies (Note 13)
-
-14
Interest expense from related parties (Note 13)
-1
-2
Cash flow transactions
Contribution to share capital of subsidiary
-
Loans issued to subsidiaries
-17
-1 837
Loans issued to related parties
-
-230
Loans received from subsidiaries
519
-
Loans received from related parties
-
4
Loans repaid to subsidiaries
-6
-5
Interest repaid to subsidiaries
-
-
Loans repaid to related parties
-
-137
Interest repaid to related parties
-
-2
The following table sets forth the aggregate
gross amounts of salaries and other
remuneration to the Board of Directors and
Executive Board in 2023 and 2022.
2023 ANNUAL REPORT
PAGE 76
in USD thousand
Salary (incl
social security
costs)
Total
2023
Members of Board of Directors
13
13
Members of the Executive Board
295
295
308
308
2022
Members of Board of Directors
12
12
Members of the Executive Board
176
176
188
188
Balances from subsidiaries and other group companies
in USD thousand
31.12.2023
31.12.2022
Receivables (Note 7)
1 511
1 406
Loan receivables (Note 7)
2 257
2 600
Payables (Note 8)
119
115
Borrowings (Note 9)
-
-
Balances from other related parties
31.12.2023
31.12.2022
Payable to related parties
35
33
16. FEES TO THE AUDITORS OF THE PARENT COMPANY
in USD thousand
2023
2022
Audit
-102
-72
-102
-72
17. COMMITMENTS
Guarantee agreement was concluded between
the Company and JSC «UKRSIBBANK» on 28
August 2015. Under surety agreement
Agromino A/S shall be liable to the Bank in
case of breach of the Debt obligations by its
subsidiaries under Loan Agreement
#11463843000 dated 23 December 2013 with
general loan limit USD 7 000 thousand.
Surety agreement #253 CL/S2 was concluded
between the Company and JSC “CREDIT
AGRICOLE BANK” on 12 February 2019. Under
surety agreement Agromino A/S shall be liable
to the Bank in case of breach of the Debt
obligations by its subsidiaries under
Agreement on rendering of banking services
#253 CL dated 07 December 2012 with
general loan limit USD 8 000 thousand.
Surety agreement #463 CL/S1 was concluded
between the Company and JSC “CREDIT
AGRICOLE BANK” on 14 January 2022. Under
surety agreement Agromino A/S shall be liable
to the Bank in case of breach of the Debt
obligations by its subsidiaries under
Agreement #463 CL dated 14 January 2022
with general loan limit USD 10 000 thousand.
Guarantee #160523 was issued by the
Company to JSC “Raiffeisen Bank” on 16 May
2023 ANNUAL REPORT
PAGE 77
2023, under which Agromino A/S shall be
liable to the Bank within aggregate maximum
of EUR 4 000 thousand in case of breach of the
Debt obligations by its subsidiaries under
Credit Operations Master Agreement
#010/150-2/304 (entered on January 25,
2017).
Surety agreement #SR 24-034/28-2 was
concluded between the Company and JSC
“OTP Bank” on 14 February 2024. Under
surety agreement Agromino A/S shall be liable
to the Bank in case of breach of the Debt
obligations by its subsidiaries under
agreements #CR 22-234/28-2 dated 06 May
2022, CR 22-236/28-2 dated 06 May 2022, CR
22-235/28-2 dated 06 May 2022, CR 23-
109/28-2 dated 20 April 2023, CR 23-476/28-
2 dated 10 November 2023 with general loan
limit UAH 152 000 thousand. For part of
general loan limit (UAH 60 000 thousand) that
was due on 03 May 2024, a new Surety
agreement #SR 24-791/28-2 was concluded
between the Company and JSC “OTP Bank” on
24 May 2024. Under surety agreement
Agromino A/S shall be liable to the Bank in
case of breach of the Debt obligations by its
subsidiaries under agreements #CR 24-
435/28-2 dated 01 May 2024.
Within the framework of the share purchase
agreement (SPA) for the acquisition of 100%
of shares of Resilient a.s. in the end of the year
2019 (Shares) a pledge over the Shares was
established by the Company in favor of Mabon
investiční fond s proměnným kapitálem a.s.
(Mabon). Mabon is controlled by Mr. Petr
Krogman, who is also the Chairman of the
Agromino‘s Board of Directors.
The pledge shall secure potential future
liabilities of the Company towards Mabon
which may arise mainly in case of substantial
breach of limited warranties by Agromino
under the SPA. No liabilities towards Mabon
under the framework of the SPA exist on the
date of this report. The Company assesses the
risk of origination of substantial liabilities
under the framework of the SPA as very low.
Consequently, the Company assesses the risk
of pledge realization as very low.
During the process of the SPA negotiation
applicable disqualification rules were
respected by the Company.
2023 ANNUAL REPORT
PAGE 78
MANAGEMENT´S STATEMENT
July 4, 2024
__________________ __________________ ___________________
__________
__________________ _________________________
2023 ANNUAL REPORT
PAGE 79
INDEPENDENT AUDITOR´S REPORT
of the matter described in the ‘Basis for
2023 ANNUAL REPORT
PAGE 80
material misstatement of the management’s
2023 ANNUAL REPORT
PAGE 81
CVR no. 32 89 54 68
MNE no. Mne33244
2023 ANNUAL REPORT
PAGE 82
DEFINITIONS
Acid test
(Total current assets – Inventories (inventories including biological
assets)-Assets held for sale (including Assets of disposal group classified
as held for sale)/Total current liabilities. The acid test or quick ratio
measures a company’s ability to use its near cash or quick assets to
immediately extinguish or retire its short-term liabilities (liabilities due
within the next twelve months).
Current ratio
Total current assets/Total current liabilities. The current ratio measures
a company’s ability to meet short-term obligations (liabilities due within
the next twelve months).
Earnings per share
Net result attributable to the shareholders of the Company/ year-end
number of common shares outstanding during the period (in accordance
with IAS 33). Earnings/loss per share for profit attributable to the equity
holders of the Company during the year, both basic and diluted.
EBITDA
EBITDA is calculated by adding to the operating profit the annual
depreciation of the fixed assets and amortisation of land-related long-
term prepayments.
EBIT
EBIT is calculated as the operating profit and does not include finance
income/cost, gains/losses from exchange rate differences and share of
profit/loss of investments accounted for using the equity method
Equity ratio
Total equity/Total assets. The equity ratio indicates how much debt a
company uses to finance its assets relative to equity.
Net debt
Total borrowings and the fair value of derivative financial instruments
(including Liabilities directly associated with assets classified as held for
sale -Cash and cash equivalents. Net debt is a measure of a company's
ability to repay its debts if they were all due today.
Return on assets
(ROA)
Net profit attributable to the owners of the parent company/Average total
assets. Return on assets compares income with total assets measuring
management’s ability and efficiency in using the firm’s assets to generate
profits.
Return on equity
(ROE)
Net profit attributable to the owners of the parent company/Average
equity excluding minority interest. Return on equity relates income with
the equity capital measuring management´s ability and efficiency in
generating a return to the shareholders of the Company
Book value per share
Total Stockholders’ equity/ year-end number of common shares
outstanding during the period (in accordance with IAS 33). The book
value per share measures the per share value of a company based on its
equity available to shareholders.